Preamble

The House met at Half-past Two o'Clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — WEST INDIES (BRITISH PUBLICITY)

Mr. Driberg: asked the Secretary of State for the Colonies if he is aware of the constant disparagement of the achievements of the people of Great Britain and of His Majesty's Government indulged in by wealthy persons from the United Kingdom now resident in Bermuda, the Bahamas, Jamaica, and other islands in the West Indies; and if he will endeavour, by establishing or strengthening information offices, by the issue of bulletins containing facts about these achievements, or otherwise, to minimise the effects of such disloyalty.

The Under-Secretary of State for the Colonies (Mr. Rees-Williams): My right hon. Friend has not received reports of the kind referred to, but he appreciates the importance of wide publicity about the achievements of Britain in the past few years. All Colonial Governments receive material on the subject of British economic and social achievements. He has recently appointed a Regional Information Officer for the Caribbean area, whose duties include advice to the Governments concerned about the effective use and presentation of this material.

Mr. Driberg: Does my hon. Friend realise that it is extremely difficult for officers such as that to get their information across in the face of local newspaper prejudices and other obstacles, and could he take some steps more emphatically to convey to the peoples of these Colonies the contempt felt by all decent people here for the lying propaganda of these tax-dodging émigré drones?

Mr. Gallacher: They are Tories.

Oral Answers to Questions — CYPRUS

Mosquito Extermination Campaign

Dr. Segal: asked the Secretary of State for the Colonies what recent reports he has received about the progress of the Mosquito extermination campaign in Cyprus.

Mr. Rees-Williams: Recent reports show that the extermination of anopheline mosquitoes in Cyprus should be substantially complete by the end of this year.

Dr. Segal: Could my hon. Friend say what steps he is taking to bring to the notice of other Colonial Governments the almost classical work performed by Mr. Azziz and his collaborators in this connection?

Mr. Rees-Williams: Publicity is given in all Colonies to anti-malarial work, and I will look into the special point raised by my hon. Friend.

Mayor of Limassol

Mr. Piratin: asked the Secretary of State for the Colonies what sentences have recently been imposed on the Mayor of Limassol, Cyprus; and what were the offences involved.

Mr. Rees-Williams: The mayor of Limassol was sentenced on 26th November to three months' imprisonment for taking part in an illegal procession. This was his eighth conviction under the Cyprus Assemblies, Meetings and Processions Law since 1943, and his third this year.

Mr. Piratin: Does not the Minister consider it is making a farce of democracy if in Cyprus local elections are permitted whereby a mayor is elected, and then that mayor may not take part in a procession in his own town?

Mr. Rees-Williams: No, I think it is making democracy work; he had a permit for a meeting, but not for a procession.

Sir Peter Macdonald: Does the hon. Member know what is happening behind the Iron Curtain?

Mr. Piratin: You worry about what you are doing.

Mr. Donner: Having regard to the responsibility of his office, is it not a fact that the Mayor of Limassol was treated very leniently in view of the criminal acts of which he was guilty?

Mr. Martin Lindsay: May we have an assurance that he will not, in due course, be made Secretary of State for War?

Dr. Segal: Is not the hon. Member aware that the Mayor of Limassol is a far more extreme and militant Communist than the hon. Member who asked this Question?

HONG KONG (IMMIGRATION)

Sir Ronald Ross: asked the Secretary of State for the Colonies what regulations exist at Hong Kong to check the character of those coming to the Colony from the mainland and to limit the total numbers admitted.

Mr. Rees-Williams: The provisions of the Immigration Ordinance apply to these people. The practical difficulties of enforcing these provisions are, of course, very great. The situation is under constant review.

Sir R. Ross: Is the Minister aware that Hong Kong is at present very overcrowded, that food difficulties are arising and that fairly large numbers of undesirable people are apparently getting in? Is he satisfied that, in the event, let us say, of panic in Shanghai, the situation would not be reduced to complete chaos?

Mr. Rees-Williams: In reply to the first part of the Question, we are only too well aware of these conditions. As for the second part, I am not at all aware that there would be chaos in Hong Kong; in fact, we are doing everything we can to prevent such a contingency.

Mr. Walter Fletcher: Would the Under-Secretary agree, in view of the fact that, on the last great wave of immigration into Hong Kong, there were great deficiences in medical and other services, that steps should be taken now, because conditions will certainly be worse in the next great wave?

Mr. Rees-Williams: We are looking into this question at the moment, and I hope the necessary steps will be taken.

Mr. John Paton: Is it not the case that the latest figures from the Colony show that the number of immigrants into the Colony is less than the number of emigrants from the Colony? I am speaking of Chinese nationals.

Mr. Rees-Williams: That may be so, but I understood that the Question put to me referred to the possibility of a large influx from Shanghai or from other parts of China.

Sir Ralph Glyn: Could the Under-Secretary say what steps have been taken to provide the necessary services to prevent disease and pestilence if there is overcrowding?

Mr. Rees-Williams: We hope to avoid overcrowding; but the Governor is now looking into all these questions to see how far the conditions can be met, either by camps or otherwise.

Oral Answers to Questions — MALAYA AND SINGAPORE

Nurses

Mr. Gammans: asked the Secretary of State for the Colonies how many hospital beds in the Federation of Malaya and in Singapore have had to be closed owing to the shortage of nurses; and why the salary scale recommended by the Trusted Commission has not been implemented.

Mr. Rees-Williams: In the Federation, 318 beds have had to be closed. In Singapore no beds which had been opened since the liberation have had to be closed. The new salary scales have been implemented in all but a few cases which are in process of adjustment.

Mr. Gammans: Can the hon. Gentleman say what can be done to get these beds reopened? Is it a question of a shortage of local nurses or a shortage of sisters recruited in this country?

Mr. Rees-Williams: I am told both.

Patrols (Armoured Cars)

Mr. Gammans: asked the Secretary of State for the Colonies if, in view of the increasing death roll of the Malayan police by ambushing on roads, he is satisfied that they have a sufficient number of armoured cards for patrol work.

Mr. Rees-Williams: A number of armoured cars for police use have already been delivered in Malaya, and others will be arriving shortly. The High Commissioner has not expressed any dissatisfaction at the position.

Mr. Gammans: Can the hon. Gentleman say why it is that only now, six months after this insurrection has started and when policemen are being murdered on main roads, armoured cars appear to be sent out?

Mr. Rees-Williams: Armoured cars have been delivered, but most of the patrols in Malaya are infantry patrols on foot and not in armoured cars. As the hon. Gentleman knows only too well, the number of places in which one can use armoured cars is limited.

Mr. Gammans: Does the hon. Gentleman deny the fact that during the past few weeks patrols and police on the main roads in Malaya have, in fact, been murdered? Surely, therefore, there must be a need for armoured cars on the main and side roads?

Mr. Rees-Williams: Most of the patrolling is done on foot. As to the number of armoured cars delivered and those still on order, we are assured by the authorities in Malaya that they are satisfied with the position.

Mr. Gallacher: Will the Minister publish a list of those in this country who have drawn big profits out of tin and rubber, and make them pay for the armoured cars?

Mr. W. Fletcher: Will the hon. Gentleman make the position clear? He said in one of his first replies that he had not had any further demand from the High Commissioner. That is not the same as being satisfied with the present position, and does not exonerate him from responsibility for seeing that armoured cars are made available?

Mr. Gallacher: How much are you getting out of it?

Mr. Rees-Williams: I did not say anything of the kind; the hon. Gentleman completely misrepresents me. What I said was that the High Commissioner had not expressed dissatisfaction.

Mr. J. Langford-Holt: Is it in Order, Mr. Speaker, for the hon. Member for

West Fife (Mr. Gallacher) to cry across the Floor of the House to my hon. Friend the Member for Bury (Mr. W. Fletcher), "How much are you getting out of it"?

Mr. Speaker: If there is any personal allegation of that kind, it is certainly out of Order.

Mr. Langford-Holt: Further to that point of Order; may I ask you, Mr. Speaker, to instruct the hon. Member for West Fife to withdraw that remark?

Mr. Piratin: Further to the point of Order. Is it not a fact that a number of Members in this House have shares in various concerns in the Colonies, and should they not declare their interest? Are we not entitled to know who has an interest in each Colony?

Mr. Speaker: The hon. Member cannot make an allegation that another hon. Member is getting something out of orders placed by the Government. It is quite improper. I am sure the hon. Member cannot have meant to make that allegation.

Mr. Gallacher: If the hon. Member assures me that he has no financial interest in the Colonies, I withdraw the allegation, but not otherwise.

Mr. Speaker: I hate qualified withdrawals. If the hon. Member had any interest, he would declare it. The hon. Member for West Fife must not make his withdrawal conditional. We must trust each other for honourable conduct, and, therefore, one should not withdraw a thing under qualifications. It should be withdrawn without qualifications.

Mr. Gallacher: I asked whether the hon. Member had an interest in this—[HON. MEMBERS: "Withdraw."] Quiet. I withdraw without any hesitation.

Educational Facilities

Sir Patrick Hannon: asked the Secretary of State for the Colonies if he will make a statement on the plans now in process for the improvement of educational facilities for the people of the Federation of Malaya and Singapore.

Mr. Rees-Williams: My right hon. Friend is asking the High Commissioner for the Federation and the Governor of Singapore for up-to-date reports, and will write to the hon. Member as soon as he has their replies.

Sir P. Hannon: Is His Majesty's administration doing everything possible to promote education in the interests of peace in the Federation and the Colony?

Mr. Rees-Williams: We quite agree with the hon. Gentleman. Both the Federation and the Colony have approved a 10-year plan for universal elementary education for boys and girls.

Mr. W. Fletcher: Will not this excellent plan for education be severely handicapped if the heavy cost of maintaining troops to put down Communism is fastened upon Malaya?

Mr. Rees-Williams: That is another question.

Oral Answers to Questions — COLONIAL EMPIRE

Geologists and Surveyors

Sir P. Macdonald: asked the Secretary of State for the Colonies what specific applications he made to British universities, the Royal Geographical Society and British air survey firms before asking the American Economic Cooperation Administration to provide Americans to fill 50 vacancies in the topographical, geodetic and geological surveys in the Colonies; and in which newspapers and on what dates he advertised the vacancies.

Mr. Rees-Williams: As the reply is necessarily long, I will, with the hon. Member's permission, circulate it in the OFFICIAL REPORT.

Sir P. Macdonald: Will the hon. Gentleman say why these positions are offered to Americans without any British scientists being offered the jobs, or even anybody in the British Commonwealth being given an opportunity of applying for them?

Mr. Rees-Williams: I am glad of this opportunity to say that there has been a complete misunderstanding. In fact, the widest publicity was given to the possibilities of employment, and the principal universities and the Ministry of Labour were approached. The representatives of the Royal Geographical Society knew all about it; and it appeared in Royal Air Force and Army Orders. In all ways we tried to get scientists. The engagement

of American scientists, if it comes off—and as yet there has been no definite conclusion on that point—will not in any way interfere with the employment of British scientists.

Mr. Keeling: Can the Under-Secretary of State deny that the Department of Geography at Cambridge, from which University the bulk of colonial surveyors have been obtained in the past, received no notice at all about these vacancies?

Mr. Rees-Williams: My information is to the contrary. I do not know about the department, but the University was certainly notified.

Mr. Lennox-Boyd: In view of the general misunderstanding among air survey firms and the complications of this problem, will the hon. Gentleman consider publishing a statement showing exactly what sort of advertisements were issued, to whom, and when?

Mr. Rees-Williams: My reply to the hon. Gentleman opposite gives a good deal of information together with a list of the newspapers and the dates on which the advertisements appeared, so I think the hon. Member's point has been met.

Following is the reply:

The principal universities and the Ministry of Labour and National Service (Technical and Scientific Register) were notified of the urgent need for geologists and surveyors in communications addressed to them during the last two years and were informed at intervals of the vacancies existing. A full general appreciation of the vacancy position, prospects and requirements for both classes of posts was circulated to universities in November, 1947.

No formal approach was made to the Royal Geographical Society, but the Society was represented at the Conference of British Commonwealth Survey Officers held in London in August, 1947, at which the shortage of surveyors and the difficulties of recruitment were fully ventilated and discussed. No approach in regard to surveyors was made to air survey firms since, as indicated in the reply given by my right hon. Friend on 29th November to an earlier question by the hon. Member, it was not clear how they could have assisted in the


supply of surveyors; nor is this clear now. These firms were however represented at the Conference mentioned above and should accordingly have been aware of the shortage if they had any suggestions to make.

With regard to the second part of the Question, advertisements for geologists were inserted in the Press on many occasions, including "The Times" of 10th October, 1947, 7th and 11th February, 1948, 1st April, 1948, 8th November, 1948; the "Daily Telegraph" of 24th October, 1947, 6th and 25th February, 1948, 30th March, 1948, and 9th November, 1948; the "Yorkshire Post" of 4th October, 1947, 31st January, 1948; the "Manchester Guardian," 28th January, 1948; the "Mining Magazine," February, 1948, and "Nature," 11th October, 1947, 30th October, 1948, 6th November, 1948.

As regards surveyors, it was considered that the most effective method of advertising was by bringing openings to the notice of men in the Forces. Such notices were inserted in Fleet Orders, Army Council Instructions and Air Ministry Orders between December, 1947, and February, 1948.

Mr. Lennox-Boyd: asked the Secretary of State for the Colonies how much of the 25 million dollars voted by the Economic Co-operation Administration for British Colonial development is earmarked for the payment of United States specialists.

Mr. Rees-Williams: So far as I am aware, no such fund has been formally instituted. The second part of the Question does not therefore arise.

Mr. Keeling: asked the Secretary of State for the Colonies whether he is aware that of 20 students trained as surveyors at Cambridge University since the war only two have entered the Colonial Service; and whether he will improve the salaries and conditions offered to surveyors who have qualified at British universities or have retired from the Survey of India.

Mr. Rees-Williams: My right hon. Friend is, of course, aware of the need for attracting more trained surveyors into the Colonial Service. Salaries have only recently been greatly improved in East Africa and Malaya, and a further increase

is now under consideration in West Africa.

Mr. Keeling: Is the Under-Secretary of State aware that the terms offered to surveyors for West Africa are inadequate to attract them?

Mr. Rees-Williams: That is the whole point of the further consideration of that question.

Mr. Keeling: asked the Secretary of State for the Colonies how soon the terms to be offered to Americans for survey work in the Colonies will be settled; and whether he will then renew his efforts to obtain British surveyors by offering the same terms for the same period.

Mr. Rees-Williams: I cannot say how long the discussions with the United States authorities will take. The second part of the Question accordingly does not yet arise.

Mr. Keeling: Will the Under-Secretary of State publish in the OFFICIAL REPORT the terms offered to American surveyors when they are settled?

Mr. Rees-Williams: ?: I have no doubt that when the matter is settled the hon. Member or some other hon. Member will put down a Question.

Mr. Keeling: I have asked it now.

Social and Economic History

Sir P. Hannon: asked the Secretary of State for the Colonies if he will inform this House of the details of his campaign to make the people of this country more familiar with the social and economic life of the Colonial Empire, the scope of the appeal to universities and secondary schools to study the history, conditions and mode of life of colonial peoples, and if appropriate text books will be made available for teachers with this objective in view.

Mr. Rees-Williams: A series of films, booklets, picture-sets, maps and other other material about the Colonies is being produced by the Central Office of Information on behalf of the Colonial Office to stimulate public interest, especially in educational institutions. Details of this material, of lecture services and of other sources of information were recently published in a pamphlet, "Britain and the Colonies," which is on


sale to the public and has been distributed to schools through local education authorities. A copy is in the Library. A Colonial Exhibition in London is planned for June next.
With regard to the third part of the Question, I understand from my right hon. Friend the Minister of Education that the selection and provision of text books is a matter for local education authorities and schools.

Sir P. Hannon: Is it the policy of the Colonial Office to use every possible means of bringing the mode of life and circumstances, political and economic, of the Colonial Empire before the people of this country?

Mr. Rees-Williams: We are trying to do so.

Mr. Skinnard: In connection with this plan, will the Under-Secretary consider the extended use of film strips, in view of the importance of visual education in this matter?

Mr. Rees-Williams: I am grateful to the hon. Member for that suggestion, which we shall consider.

Maps

Sir P. Macdonald: asked the Secretary of State for the Colonies whether he is aware that maps are essential for the development of the food and mineral resources of the Colonies; and whether he will consider employing British air survey companies in order to reduce the period of 10 years required for the completion of the colonial mapping programme.

Mr. Rees-Williams: My right hon. Friend is fully aware of the importance of maps for the purposes mentioned. He has already received a memorandum from the British air survey companies which is under examination.

Sir P. Macdonald: Is the hon. Gentleman aware that these British survey companies employ 45 aircraft and over 1,000 people? Why should they not be employed by this Government when they are employed by the Governments of Canada, India and Australia?

Mr. Rees-Williams: The main reason is that we prefer, if possible, to employ the R.A.F. It is much cheaper. It is good

training for the Air Force, and they are used to the particular class of work which is requited for the survey.

Sir P. Macdonald: In view of the very limited amount of survey work which they can do, will the Under-Secretary see that any work above the capacity of the R.A.F. is put in the hands of British scientists and not American scientists?

Mr. Rees-Williams: The hon. Member will see from the reply to a question which will appear in HANSARD tomorrow—I am not quite sure whether the hon. Member was here or not—that actually the amount photographed is much greater than that which it has been possible to map. The delay, where there is delay—and there really is not a delay in this matter—is on the mapping side rather than the hotographing side.

Mr. Driberg: Could my hon. Friend say whether there is any new policy in this matter, or are the Government simply continuing the practice which has always obtained?

Mr. Rees-Williams: We are continuing the practice laid down by the right hon. Gentleman the Member for West Bristol (Mr. Stanley).

Mr. Lennox-Boyd: Is it not a fact that the air survey companies also have mapping facilities and that they could help to remedy this bottleneck?

Mr. Rees-Williams: That is not the opinion of the Director of Colonial Surveys, Brigadier Hotine, who would rather have the whole thing under his control.

Sir P. Macdonald: asked the Secretary of State for the Colonies to what extent the geological survey of the Colonies is being delayed owing to the slow delivery of maps.

Mr. Rees-Williams: I do not agree that geological surveys are being delayed by shortage of maps. All geologists appointed to date are fully employed.

Mr. Keeling: asked the Secretary of State for the Colonies how many square miles of territory in the Colonies have been mapped during the last two years; and what proportion this is of the area photographed by the R.A.F.

Mr. Rees-Williams: About 380,000 square miles have been photographed and maps covering 25,000 square miles


at various scales have been printed and published. Another 25,000 square miles have been mapped and are awaiting publication. Fifty-seven thousand square miles are at an advanced stage of compilation. The total amounts to about 30 per cent. of the area so far photographed.

Mr. Lennox-Boyd: asked the Secretary of State for the Colonies whether in view of the Report of the Evans Commission that topographical maps are urgently required in British Guiana, he will review his programme for meeting the immediate survey requirements in that Colony.

Mr. Rees-Williams: Yes, Sir.

Oral Answers to Questions — AFRICAN COLONIES

Gold Coast (Removal Orders)

Mr. Dodds-Parker: asked the Secretary of State for the Colonies whether criminal proceedings are being taken by the Gold Coast Government against those members of the United Gold Coast Convention against whom removal orders were made by the Governor in the interests of peace and good order.

Mr. Rees-Williams: No, Sir.

Mr. Dodds-Parker: Will the Under-Secretary say what action the Government are taking in the interest of peace and good order?

Mr. Rees-Williams: Peace and good order are established in the Gold Coast, and the normal procedure of government is being followed.

Mr. Dodds-Parker: Has any action been taken against those members against whom removal orders have been made, and have they been carried out?

Mr. Rees-Williams: The action taken during the emergency was of a preventive nature, and when the emergency finished the necessity for action of that kind also finished.

Tanganyika (Railway Construction)

Mr. Dodds-Parker: asked the Secretary of State for the Colonies whether he can make a statement on the construction of the railway from the Tanganyika Central Railway to the lead

mines at Uruwira; whether, in view of the recent reports that the prospects of large-scale mineral operations in this area seem unlikely, it is proposed to continue with the construction of the railway; and what amount has been spent on the railway up to date.

Mr. Rees-Williams: There is no indication at present that the estimated quantity of basic ore is less than that which was considered sufficient to justify the construction of the railway, which is proceeding. The whole question will, however, be considered by the Transport Advisory Council on 10th December in the light of the latest information. Expenditure on the construction of the branch line up to the end of July amounted to £121,785 and the estimated expenditure in August was £21,431.

Mr. Erroll: Would it not have been very much better to have built a road in the first place and only to have built a railway when proved traffic was found to exist?

Mr. Rees-Williams: The Tanganyikan Government did not think so.

Education

Mr. Rankin: asked the Secretary of State for the Colonies what is to be the place of religion and religious teaching in the new African university colleges.

Mr. Rees-Williams: The university colleges are autonomous institutions. The college authorities appreciate the place of religion in education and the need for providing arrangements for religious observance.

Mr. Skinnard: Would it not be preferable, in view of the varied religions and races of the students admitted to these universities, for the study of religion to be made in the schools of philosophy in the form of a study of comparative theology?

Mr. Rees-Williams: This is a matter for the university authorities, and I could not intervene in it.

Mr. Rankin: asked the Secretary of State for the Colonies what use is being made of intelligence tests in the education of African children.

Mr. Rees-Williams: Intelligence tests are not in systematic use in the education


of African children. The possibility of developing tests suitable for use in the various African territories is being examined in the Colonial Office, taking into account experiments carried out in Nigeria and the tests applied to African troops during the war.

Mr. Rankin: Would not my hon. Friend agree that in those cases where the demand for school places exceeds the supply, ability to pay ought not to be the hall-mark of entrance, but that intelligence tests ought to be applied in such cases?

Legislative Council, Nyasaland

Mr. Skinnard: asked the Secretary of State for the Colonies by what method of selection the two new African and one new Asiatic members are to be appointed to the Legislative Council of Nyasaland.

Mr. Rees-Williams: The Africans will be appointed by the Governor from a panel of five chosen by the Protectorate Council and the Asiatic member from a panel of three chosen by the Indian Chamber of Commerce.

Mr. Skinnard: Is the Under-Secretary aware that, although there has been considerable dissatisfaction expressed by some Africans at this method it is the opinion of the majority of the people that the method adopted is the better and fairer method?

Mr. Rees-Williams: I agree with the latter part of that supplementary question, but I had not heard that there was considerable dissatisfaction with the method adopted. My information was to the contrary.

PALESTINE (COURT DEPOSITS)

Mr. Janner: asked the Secretary of State for the Colonies what steps he has taken to ascertain details of the sums held in the Palestine Government account in respect of court deposits; what results have been obtained; and when does he propose to refund the deposits.

Mr. Rees-Williams: The approximate amount held in Palestine Government Account in respect of the court deposits is £175,000. Since detailed records of

the deposits in question were handed over to the local authorities on the termination of the Mandate, it is not practicable to make any arrangements to release the deposits until they can be verified from these records and arrangements can be made to refund deposits, where due, through the successor authorities to the former Government of Palestine.

Mr. Janner: Could my hon. Friend say whether these are sums which are being deposited on the instruction of the court or whether he has taken any steps at all to ascertain what these sums are? Would he be prepared to consider the direct claims of the people ordered by the courts to pay these sums into court?

Mr. Rees-Williams: This matter is now in the hands of the Palestine courts and we cannot take steps to verify records which are in the possession of the Palestine courts, but when they are verified and authorised the amount is still available to be paid out.

Mr. Janner: Is not my hon. Friend aware that while this matter is in the hands of the Palestine courts, the money is in the hands of the Colonial Office? Is he prepared to hand out that money to the Palestine courts so that it could be distributed to the proper persons?

Mr. Rees-Williams: I have explained in my answer to the hon. Member the conditions under which the money would be paid out.

LEGISLATIVE COUNCIL. SEYCHELLES (MR. COLLET)

Mr. Gammans: asked the Secretary of State for the Colonies from what date and for what reasons Mr. Collet has been appointed a nominated unofficial member of the Legislative Council of the Seychelles.

Mr. Rees-Williams: By virtue of the discretion bestowed on him by Section 7 (1) of the Seychelles (Legislative Council) Order-in-Council, 1948, the Governor has appointed Mr. Collet, with effect from 29th November, 1948, to represent the interests of those sections of the community which would not otherwise be represented in the Council.

Mr. Gammans: Is the hon. Gentleman aware that this man Collet was convicted of contempt of court, and that the Secretary of State gave me a categorical assurance on this matter on 22nd September that, "It is not my intention to offer Mr. Collet any official post in the administration of the Seychelles." Now he has made this man a Legislative Councillor.

Mr. Rees-Williams: There are several misstatements in that supplementary question. First of all, so far as I am aware, this man was not convicted of contempt of court, although the Chief Justice thought he had been guilty of contempt of court. Secondly, he has not been appointed to any official position; he has been appointed as an unofficial member of the Council. [Laughter.] I admit all these misstatements about a simple question are very amusing. The third misstatement of the hon. Member is this: the matter has nothing to do with my right hon. Friend, but is entirely in the discretion of the Governor.

Mr. Oliver Stanley: May I ask the hon. Gentleman who are the classes of people this man is supposed to represent and what are his qualifications for representing them?

Mr. Rees-Williams: The classes of people are the under-privileged and this man, having been brought up as a member of the under-privileged classes, can well represent them.

Mr. H. D. Hughes: Is my hon. Friend aware that Mr. Collet has played an important part in remedying grave social abuses in the Seychelles and that his appointment will be welcomed by the Colony?

Mr. Gammans: Is it not a fact that the Secretary of State for the Colonies has to approve the appointment of this man on the Legislative Council? If that is so, how can he try to get out of it by suggesting that this appointment is not a direct contravention of the pledge given to me in writing on 22nd September?

Mr. Rees-Williams: It is not a fact. This appointment needs no approval from my right hon. Friend.

Mr. Keeling: Does the Under-Secretary assert that an unofficial member of a

Colonial council is not in an official position?

Mr. Rees-Williams: I do so assert. That is the point of his being unofficial.

MALTA (AIRPORT)

Commander Noble: asked the Secretary of State for the Colonies whether he will now make a statement on the discussions between his Department and the Ministry of Civil Aviation with regard to Luqa airport, Malta.

Mr. Rees-Williams: Discussions are still in progress. Arrangements are being made for the despatch of a mission to Malta early in the New Year to discuss certain outstanding questions concerning civil aviation, including the future use of Luqa airport.

Commander Noble: In view of the great concern this is causing to Malta, could not some interim report be issued on the discussions before the mission goes out?

Mr. Rees-Williams: The mission is going out in the middle of next month and I hope the report will be to hand very soon after that. I do not think there is any possibility of an interim report.

Air-Commodore Harvey: In carrying out these discussions, will the hon. Gentleman bear in mind the increasing unemployment in Malta, and see that they get a square deal in this matter?

Mr. Rees-Williams: Certainly.

Oral Answers to Questions — ROYAL NAVY

Port Royal, Jamaica (Land)

Mr. Driberg: asked the Parliamentary Secretary to the Admiralty to what uses the land owned or occupied by his Department at Port Royal, Jamaica, is now put; and if, in view of the overcrowded and squalid conditions in which the people of this place live, he will consider making some of this land available for their temporary or permanent rehousing.

The Civil Lord of the Admiralty (Mr. Walter Edwards): The Admiralty land at Fort Royal consists of the old Naval Yard, the site of the old hospital, and land adjacent to the Naval Yard surrounding the lagoon. Part of the Naval Yard is used by the War Department; part is let to a commercial interest and the disposal of the remainder is under consideration. Neither the unused portion of the Naval Yard nor the sandy and swampy land surrounding the lagoon is considered suitable for housing. The Admiralty is advised that the site of the old Naval Hospital is more suitable for commercial development than for housing.

Mr. Driberg: What sort of commercial development does my hon. Friend suggest is likely to take place there?

Mr. W. Edwards: It is not a question of what sort of commercial development is suggested, but whether there is ground suitable for housing.

Mr. Driberg: Would it not be more suitable for housing than the houses in which the people are at present accommodated?

Mr. Edwards: It may be more suitable, but I doubt myself whether we want to erect new or semi-permanent houses on ground that is most unsuitable.

Destroyers

Sir R. Ross: asked the Parliamentary Secretary to the Admiralty how many destroyers have been disposed of since VJ-day and are not now available; and how many new destroyers have joined the fleet during the same period.

The Parliamentary and Financial Secretary to the Admiralty (Mr. John Dugdale: Ninety-eight destroyers have been disposed of since VJ-day either by scrapping or transfer to foreign Powers. Thirty-nine destroyers have been completed and joined the Fleet during the same period.

Sir R. Ross: Is the hon. Gentleman aware of the extreme importance of this class of vessels and other escort vessels, and of the danger of their running down to low numbers, as they appear to be doing?

Mr. Dugdale: Yes, Sir, we are fully aware of that. I should like to remind

the hon. Gentleman that, of course, the new destroyers are infinitely better than the old destroyers that have been scrapped, many of those that have been scrapped having been exceedingly old and worn out.

Sir R. Ross: Is the hon. Gentleman aware of the importance of numbers as well as the importance of the soundness of the individual vessels?

Mr. Dugdale: Certainly.

Viscount Hinchingbrooke: What does the hon. Gentleman mean by "transfer"? Does he mean sale? If not, why not?

Mr. Dugdale: Some are sold and some of them have been lent.

Sir W. Smithers: The hon. Gentleman referred to foreign Powers. How many of these destroyers were sent to Russia?

Aircraft Carriers

Sir R. Ross: asked the Parliamentary Secretary to the Admiralty in how many aircraft carriers under construction is work at present suspended.

Mr. J. Dugdale: Constructional work on four aircraft carriers is at present suspended, but work on one of these will shortly be resumed. I may add that in the case of all four ships work is proceeding both in relation to the preparation of machinery and the preparation of guns.

Sir R. Ross: Is the right hon. Gentleman aware of the supreme importance of this class of vessels and that deterioration always take place when work is suspended in a vessel for a long period of months? How long have they been lying without work going on in them?

Mr. Dugdale: For varying periods. I may add that they are kept, as far as possible, in a good state of preservation pending the resumption of work, and that we do attach the greatest possible importance to that.

Commander Noble: Can the hon. Gentleman say whether these ships were included in the list of ships under construction as given in the last Naval Estimates? Is he aware that he told us a few weeks ago that there were no changes in that list?

Mr. Dugdale: No, Sir. They were under construction, but the construction was suspended.

Commander Noble: Did not the hon. Gentleman tell us a few weeks ago that there were no changes in the list issued with the Naval Estimates?

Mr. Dugdale: Nor are there. There is no contradiction at all. I said they are, in fact, under construction, but that the construction was suspended.

Sir R. Ross: Can the hon. Gentleman say when work on these vessels will be recommenced?

Mr. Dugdale: One, the "Majestic," will be resumed quite soon.

Swimming Instruction (Boy's Death)

Mr. Edward Evans: asked the Parliamentary Secretary to the Admiralty if he is now in a position to make a statement on 2nd Class Boy Gordon Lindsey who was drowned during a swimming exercise at Shotley.

Mr. J. Dugdale: I would refer my hon. Friend to the reply which I made to my hon. Friend the Member for Peterborough (Mr. Tiffany) on 24th November.

Mr. Evans: While not wishing to pursue this tragic and unfortunate incident further, may I ask my hon. Friend whether he can give us an assurance that the training of officers and instructors in charge of young boys will be extended further than it is at present and go beyond the mere physical training of these boys?

Mr. Dugdale: I am not quite sure what my hon. Friend means by that question. I am satisfied that the officers concerned there are fully trained, and that they did show great restraint and great care in their training of this boy.

Mr. Attewell: asked the Parliamentary Secretary to the Admiralty what were the methods of keeping afloat taught to the late 2nd Class Boy Gordon Lindsey during his period of instruction.

Mr. J. Dugdale: Lindsey received instructions in breast stroke, swimming on his back, floating on his back, and in treading water.

Captain Marsden: Does not the hon. Gentleman think that there was something wrong in this boy's make-up, so that his original examination for the

Navy should have stopped his entering the Service at all?

Mr. Dugdale: No, Sir. It really was a most unusual case. It is a quite extraordinary thing that this particular combination of circumstances should have resulted in death. I have been assured by an eminent pathologist that cases such as this are exceedingly rare.

Mr. Attewell: asked the Parliamentary Secretary to the Admiralty if the parents of the late 2nd Class Boy Gordon Lindsey were present at the inquiry into the circumstances of his death; if the parents were represented at the inquiry: and by whom.

Mr. J. Dugdale: Lindsey's parents were not present or represented at the Naval Board of Inquiry. The circumstances of the boy's death had previously been fully investigated at a coroner's inquest, which the boy's three brothers attended.

Mr. Tiffany: Is my hon. Friend aware of the fact that this boy's mother—he has no father—was not present at the inquiry, and that she and I paid a visit to H.M.S. "Ganges" last Friday, and that we were received with every kindness and consideration by the captain, officers and boys? Will my hon. Friend consider the setting up of a commission, or a committee, of Members from all parts of the House to go into this matter in order to remove what is a definite misapprehension in the minds of many of us in relation to this incident?

Mr. Dugdale: I do not think there is any need to set up a committee, but I am sure that my noble Friend and I would be only too happy to see any hon. Members who would like to discuss the matter.

Mr. J. P. L. Thomas: In view of the public anxiety about this case, will the hon. Gentleman reconsider his reply of a few weeks ago, and put a copy of the findings in the Library?

Mr. Dugdale: We consider that we have to treat the findings of these inquiries as privileged documents. This consideration does not apply only to this inquiry, but to every inquiry generally. We have to be quite certain that the people giving evidence know that they are giving it in confidence. That consideration concerns not only this inquiry.


It is a principle applied generally to inquiries. I think I ought to add that this inquiry was over and above the full public inquiry which took place at the coroner's inquest, at which there was no question whatever of any ill-treatment of the boy. The coroner was entirely satisfied that everything possible was done.

Mr. Sydney Silverman: In view of the answer my hon. Friend gave me a week or two ago about this matter of the representation of the parents at the inquiry, will he now say what facilities were afforded to the parents in advance of the inquiry to be represented at it, to attend it, to cross-examine and to call evidence themselves?

Mr. Dugdale: I regret to say that the parents were not invited to give evidence, and, as I said in my letter to my hon. Friend, we have laid down that in future relatives will be invited to give evidence on Naval Boards of Inquiry into deaths or accidents whenever it is expected that they will have information of value to contribute. In the past, that has generally been the practice, but we have now laid it down that it must always be the practice in future.

Mr. W. R. Williams: Who is going to decide whether the parents have evidence to contribute?

Mr. Dugdale: Quite obviously there are certain cases when they will and certain cases when they will not. If a boy were suddenly killed by a bomb falling on him in a ship, it is probable that the parents could give no evidence of any value; but if it were something, as in this case, connected with his previous life, they would have such evidence.

Mr. Attewell: asked the Parliamentary Secretary to the Admiralty what degree of compulsion was used to get into the swimming bath the late 2nd Class Boy Gordon Lindsey.

Mr. J. Dugdale: The only form of compulsion used was to take the boy by the arm to the edge of the bath, when he either climbed down the steps or jumped into the water. This was done only when he was wearing a lifebelt.

Mr. Tiffany: Is my hon. Friend aware that on the last occasion when the boy

entered the swimming bath it was at his own wish that he did so, and that he himself made a request in order to get the test done with? Does not this in itself show the necessity of hon. Members knowing the full details of this occurrence and thereby removing any injustice to all concerned?

Mr. Dugdale: The hon. Member is perfectly correct.

Commander Noble: Will the Parliamentary Secretary bear in mind that most difficult psychological problems can arise, and will he give an assurance that every care is taken over supervision and especially with regard to medical examination before the tests are carried out?

Mr. Dugdale: Yes, Sir.

Mr. Somerville Hastings: Can my hon. Friend say whether the whole of the facts of this sad case have been put before some competent psychologist?

Mr. Dugdale: Undoubtedly they have.

Mr. S. Silverman: Does my hon. Friend realise that it is precisely in order to do justice to everyone, and to get all the facts established, that it is so necessary at an inquiry to have everyone represented who has any interest in the matter, and to have all the witnesses called?

Animal Experiments

Mr. Emrys Hughes: asked the Parliamentary Secretary to the Admiralty how many warships have been fitted out for experiments on animals in connection with research into atomic warfare; and what animals are to be acquired for this purpose.

Mr. J. Dugdale: I would refer my hon. Friend to the answer I gave on 10th November to my hon. Friend the Member for Epping (Mrs. Manning).

Mr. Hughes: Can we be told whether similar experiments have already been carried out in America, and whether the information gained by the American Navy is transferred to our Navy?

Mr. Dugdale: That is quite another question.

Service Stores (Inspectors)

Mr. Edelman: asked the Parliamentary Secretary to the Admiralty how many inspectors of service stores are employed by his Department.

Mr. W. Edwards: I assume that the question relates to the inspection, in the course of manufacture, of all production by contract for naval use. In that case the answer is 1,250 including industrials.

H.M.S. "Ajax"

Commander Maitland: asked the Parliamentary Secretary to the Admiralty whether a decision has now been reached in regard to the disposal of H.M.S."Ajax."

Mr. J. Dugdale: No, Sir.

Commander Maitland: Why cannot we have information about this? For six months we have been asking the Government whether we may be told something which surely everyone in this country wants to know.

Mr. Dugdale: One reason, and a very important reason, is that we have as yet had no firm offer from the Chilean Government.

Sir R. Ross: Has it yet been decided that this famous ship shall not be given to a country engaged in aggression against the possessions of this country?

Mr. Dugdale: I cannot anticipate a decision when we have not even had a firm offer from the Chilean Government.

Mr. Donner: Can the Parliamentary Secretary say why we should sell this ship at all?

Commander Maitland: Does the Parliamentary Secretary's answer mean that we are still hawking this ship to the Chilean Government?

Mr. Dugdale: It does not mean anything of the kind.

Married Quarters

Mr. J. P. L. Thomas: asked the Parliamentary Secretary to the Admiralty the number of married quarters available in the United Kingdom for officers and other ranks of the Navy, respectively; the number of such married quarters at present unoccupied awaiting repair; the number of married quarters at present

under construction; and the number of officers and men whose names are at present on a waiting list for married quarters.

Mr. W. Edwards: The numbers of married quarters in the United Kingdom occupied by naval officers and ratings are 260 and 322 respectively. In addition, improvised quarters are occupied by 73 officers and 140 ratings. The number of married quarters at present unoccupied while awaiting repair is not readily available, but it is known to be very small. The number of married quarters under construction or for which contracts have been let is 200. In addition, conversion of existing buildings is in hand which will provide a further 20 quarters.
Naval officers and ratings have no entitlement to married quarters in the United Kingdom, and there is therefore nothing in the nature of a waiting list. It is, however, the Admiralty's intention to provide married quarters to a reasonable extent at certain isolated establishments, particularly air stations, and the construction and conversion programme to which I have referred is a step towards implementing that intention.

Re-Engagements

Commander Noble: asked the Parliamentary Secretary to the Admiralty how many ratings and other ranks of the Royal Navy and Royal Marines completed their first period of service during the past 12 months; how many of these have signed on to complete their time for pension; and of these what proportion were chief and petty officers and equivalent ranks.

Mr. J. Dugdale: During the 12 months ended 30th September, 1948, 3,480 naval ratings completed their first period of continuous service. Of these, approximately 23 per cent. were chief petty officers and 54 per cent. petty officers. The number already reported as having re-engaged is 833, of whom 38 per cent. are chief and 51 per cent. petty officers. There are, however, a number of reports outstanding and it is expected that the numbers finally reported as re-engaging will be about 970. I regret that the corresponding figures for the Royal Marines are not readily available, but I will write to the hon. Member when they have been obtained.

Commander Noble: Can the Parliamentary Secretary tell us what he considers are the reasons for about only one-third of these men remaining in the Service?

Mr. Dugdale: I am not so certain that that is not a fairly satisfactory proportion.

Commander Maitland: Can the hon. Gentleman say how these figures compare with those for 1947, or give us some indication of whether the tendency is better or worse?

Mr. Dugdale: Not without notice.

Training Establishment, Crail

Mr. Henderson Stewart: asked the Parliamentary Secretary to the Admiralty if he is aware of the disappointment caused in Scotland by the decision to close down the boys' naval training establishment at Crail, in view of the fact that its establishment last year provided for the first time for the training of boys for the Royal Navy in Scotland; and what steps are to be taken to maintain recruiting of Scottish boys for the Royal Navy.

Mr. W. Edwards: I am aware that a decision such as this could not have been taken without causing some disappointment in Scotland. But I am conscious, too, that Scotsmen would not readily acquiesce in the expense of a naval establishment after it had fulfilled its purpose. I see no reason to expect that the closing of this establishment will affect the rate of recruitment of Scottish boys who like others are attracted rather by the prospects of a good career in the Royal Navy than by the very temporary convenience of spending their first year in an establishment near their homes.

Mr. Henderson Stewart: Does the hon. Gentleman recollect the pride with which his hon. Friend the Parliamentary Secretary announced the establishment of this station some 18 months ago on the ground that it gave Scotland a training centre for boys, and if it was right then how does it come to be so wrong now?

Mr. Edwards: I am certain that everyone in the House was quite proud of the fact that Scotland was to have a training centre for boys, but it was explained at that time that it was only to be of a temporary nature. I would point out to the hon. Member that the main reason why this establishment can no longer

continue as a boys' training establishment is because of the pressure being used to send as many men to sea as possible, and, in this connection, over 200 officers and men have been released for sea service.

TELEPHONE EXCHANGE, SOUTHAMPTON

Mr. Ralph Morley: asked the Postmaster-General if he is aware of the concern amongst the staff of the telephone exchange in Southampton over conditions in that exchange; and what steps does he propose to take to provide a new building which will give facilities to the staff to provide, in reasonable comfort, an efficient service for the public in the Southampton area.

The Postmaster-General (Mr. Wilfred Paling): Yes, Sir. The Southampton Corporation approved the Post Office scheme for a new exchange in 1945, but shortage of labour and materials has so far prevented any progress. I hope that work will start on the new building early in 1949, provided that the corporation do not demur on account of their revised town planning arrangements.

WALES (PROPOSED NATIONAL COUNCIL)

Mr. Price-White: asked the Prime Minister the date of his receipt of an application by the South Wales branch of the Workingmen's Club and Institution Union Limited for representation upon the proposed National Council for Wales.

The Prime Minister (Mr. Attlee): Twenty-sixth November, 1948, Sir.

Mr. Price-White: Whilst I neither support nor deny the right of this particular company to representation on the proposed Council for Wales, I would ask whether the Prime Minister does not agree that it is rather remarkable that the right hon. Gentleman himself and every Member representing a Welsh constituency should have received a very full copy of the application to the Prime Minister for representation on this Council, dated 25th November, the morning after the Lord President announced to this House the terms of the Government's proposal in regard to the Council for Wales; and does that not indicate that


certain parties in South Wales knew more about the Government's proposals than this House; and if so, will the Prime Minister look into it? It is a matter fully to be deprecated that outside influences should know more about these matters than the House itself.

The Prime Minister: That supplementary question seems to give a great deal of information, and I should like to have a look at it.

Sir Henry Morris-Jones: Is the Prime Minister aware that his right hon. Friend the Lord President of the Council has slipped badly in his technique over the introduction of this Welsh Council?

IONOSPHERIC STATION, GRAHAM LAND

Mr. Donner: asked the Lord President of the Council whether his attention has been drawn to the recommendation contained in the Report of the Committee on Radio and Cosmic Ray Research, that the possibility of installing an ionospheric station in Graham Land should be explored by the United Kingdom authorities; whether such investigation has been carried out; and with what result.

The Lord President of the Council (Mr. Herbert Morrison): Yes, Sir, With a view to exploring the ionospheric conditions of the southern hemisphere the D.S.I.R. established an ionospheric station in the Falkland Islands in the middle of 1947. The officer in charge of the station, in company with the Governor of the Falkland Islands, selected a suitable site for a station in Graham Land. The recommendation of the Committee on Radio and Cosmic Ray Research now stands referred for approval to the appropriate Radio Committee of the D.S.I.R. The Department has meanwhile taken some steps towards establishing a station in Graham Land as soon as staff and equipment can be sent there.

Mr. Donner: In view of that answer, will the right hon. Gentleman ask the Foreign Secretary to make quite sure that Graham Land will not be occupied by the Argentine or Chile, as were other Falkland Island Dependencies as a result of the failure of the Government to protect them?

Mr. Morrison: The reply I have given has been made after consultation with the Foreign Office.

Oral Answers to Questions — ARMED FORCES

Hong Kong

Mr. Donner: asked the Minister of Defence in view of the deterioriating political and military situation in China, what precautionary measures he proposes to take to safeguard the mainland frontiers of Hong Kong.

The Minister of Defence (Mr. Alexander: The security arrangements in Hong Kong are receiving constant attention, but it would be contrary to the public interest to make a statement regarding precautionary measures.

Mr. Donner: Could the right hon. Gentleman give an assurance that the measures now being taken and the reinforcements now being planned will be sufficient to maintain the frontiers during the next few months?

Mr. Alexander: The matter is under the active control and consideration of the Committee of Commanders-in-Chief of all three Services in the Far East, who will make whatever recommendation is required.

Mr. Donner: Have we got the Forces to carry out those recommendations?

Mr. Alexander: I do not think that Question is on the Order Paper.

Lieut.-Commander Gurney Braithwaite: Are any steps being taken to recruit voluntary defence forces in Hong Kong?

Mr. Alexander: Yes, Sir.

Mr. Boyd-Carpenter: Have any reinforcements actually been despatched?

Mr. Alexander: I do not think that is a proper question to put to me at the present moment, in view of my original answer.

Service Stores (Inspection)

Mr. Edelman: asked the Minister of Defence whether he will consult with his colleagues at the Admiralty and the Ministry of Supply with a view to


rationalising and co-ordinating the their discussions with General Bradley, present system of inspection of Service stores.

Mr. Alexander: As I have indicated in correspondence with my hon. Friend, I am looking into the points he has raised and will communicate with him again as soon as possible.

Married Men (Pay Rates)

Brigadier Thorp: asked the Minister of Defence the number of married men in the Navy, Army and Air Force, respectively, who will receive no increase of pay under the new rates announced on 24th November; and the number of married men of each Service who make no voluntary addition to the qualifying allotment.

Mr. Alexander: It is estimated that some 500 married men in the Navy, 5,000 in the Army and 3,000 in the R.A.F. have received no increase in pay since 24th November, but many of these have received an increase in marriage allowance of 7s. a week. I regret that the figures asked for in the last part of the Question cannot be provided without undue labour.

Women's Services (Pay and Allowances)

Mrs. Middleton: asked the Minister of Defence whether he is yet in a position to make a statement upon pay and allowances in the Women's Services.

Mr. Alexander: If my hon. Friend will be good enough to repeat her Question next week, I hope to be able to make a statement then.

Discussions, Washington

Mr. Platts-Mills: asked the Minister of Defence the purpose of the visit to Washington of Lieut.-General Sir Kenneth Crawford, Deputy Chief of the Imperial General Staff, and of Air-Marshal Sir Ralph Cochrane, Air Officer Commanding-in-Chief, Flying Training

Command; and what was the nature of their discussions with General Bradley, Chief of Staff of the United States Army.

Mr. Alexander: Close liaison on matters of mutual interest is maintained between the British and United States Forces. The visits referred to were in furtherance of that policy.

Mr. Platts-Mills: Is not it now possible for my right hon. Friend to stop this continuous stream of high-ranking officers across the Atlantic to get instructions, as its only effect in this country and America is to feed the war talk that is so current?

Mr. Alexander: In view of the hon. Member's apparent knowledge of military matters in Moscow, which he expressed this week, perhaps he would direct the same sort of question to Moscow.

Mr. Langford-Holt: Will the right hon. Gentleman give an undertaking that there is no intention to change the title of this officer to "The Deputy Chief of the Commonwealth General Staff"?

Mr. Alexander: I should think not.

Oral Answers to Questions — FOOD SUPPLIES

Fish (Prices)

Mr. Edward Evans: asked the Minister of Food the prices of the main categories of fish landed by British vessels in March and October, 1938, paid to producers, and those paid in March and October, 1948, respectively.

The Minister of Food (Mr. Strachey): As the reply is rather long I will, with permission, circulate it in the OFFICIAL REPORT.

Mr. Evans: Could my right hon. Friend tell me how far any increase or reduction in the prices paid to producers of fish is reflected in retail shops?

Mr. Strachey: I think that my hon. Friend should await the table of figures. from which he will be able to judge for himself.

Following is the table:


AVERAGE VALUES OF CERTAIN VARIETIES OF FISH LANDED IN ENGLAND AND WALES MARCH AND OCTOBER, 1938 AND 1948



1938
1948


Average Value per Stone
Average Value per Stone
Current Maximum Prices for Fish on a first hand Sale


March
October
March
October




s.
d.
s.
d.
s.
d.
s.
d.


s.
d.


Soles
…
14
5
21
2
25
4
25
4
(Whole)
…
25
5


Halibut (Whole and Headless)
…
11
2
10
2
20
4
20
7
(Whole)
…
20
6












(Headless)
…
25
11


Plaice
…
6
3
7
4
12
3
13
10
(Whole)
…
13
10


Hake
…
4
11
6
6
11
10
11
10
(Whole)
…
11
10


Haddock (Whole and Headless)
…
1
8
2
6
7
2
7
2
(Whole)
…
6
0












(Headless)
…
8
4


Cod (Whole and Headless)
…
1
4
2
3
5
7
6
1
(Whole)
…
4
9












(Headless)
…
6
7


Ray and Skate (Whole and Wings)
…
3
1
3
5
5
7
5
7
(Whole)
…
5
3












(Wings)
…
10
11


Saithe (Whole and Headless)
…
0
8
1
1
3
7
4
3
(Whole)
…
3
6












(Headless)
…
4
7


Herrings
…
0
9
0
8
3
2
2
5


3
2½

NOTES.—(i) From information issued by the Ministry of Agriculture and Fisheries showing quantities landed in England and Wales at landed weight and value realised. Similar information for Scotland, from the Scottish Home Department, is not included in the above table because quantities landed in Scotland are issued on a different basis, i.e. at the equivalent whole fish weight. Therefore, an estimate of the average value per stone could appear to indicate that lower prices were realised. Scottish figures are, however, available if required.

(ii) Average values are to the nearest penny.

(iii) In October quantities of herrings are taken for export processing at reduced prices.

Biscuit Manufacturers (Sugar Allocations)

Mr. Turton: asked the Minister of Food whether the 37 manufacturers exporting biscuits who have been granted additional sugar are permitted to use this sugar for the manufacture of biscuits for the home market.

Mr. Strachey: The extra sugar which is being allocated as an export incentive will all be used in producing biscuits for the home market, and any manufacturer who contributes to our export drive by exporting biscuits to desirable markets will qualify for a share. Sugar used in the production of biscuits for export will continue to be replaced in the normal way.

Mr. Turton: Does not that reply mean that certain biscuit manufacturers are being penalised because they have not pleased the Minister of Food; and will he stop discriminating in this way between manufacturers?

Mr. Strachey: No, Sir, I certainly will not stop discriminating as between those

manufacturers who export and those who do not. We are giving a premium to those who export, and shall continue to do so.

Tea Ration

Mr. Turton: asked the Minister of Food what amount of tea is required to meet a year's domestic tea ration of 2 oz. and 2½ oz. per week, respectively.

Mr. Strachey: The annual amounts of tea required to meet a 2 oz. and 2½ oz. domestic ration, with all the other requirements related to domestic rations of that size, are 410 million lb. and 510 million lb. respectively.

Mr. Turton: Can the Minister say what steps he is taking to get that amount of tea imported into the country?

Mr. Strachey: We are taking steps to import the maximum amount of tea we can procure and can afford to buy.

Meat (Bulk Purchases)

Sir W. Smithers: asked the Minister of Food if, in view of the fact that £558,362 is being paid to the Uruguayan


Government under the new meat agreement, in order to bring prices into line with those paid to the Argentine, he will cease bulk purchases and allow meat for Britain to be bought through recognised trade channels under competition.

Mr. Strachey: I am satisfied that in present circumstances it is not advisable to do as the hon. Member suggests. It would, of course, cost far more to bring our meat prices into line with meat prices in those markets where private trade in meat now exists. For example, the retail price of meat in the U.S.A. is some 4s. per lb.

Sir W. Smithers: Does the Minister of Food have to obtain Treasury permission before entering into these food contracts; is there any control at all over his antics; and how much longer is he to be allowed to squander the taxpayers' money?

Mr. Strachey: If the hon. Member were as familiar with Treasury control as I am, he would have no doubt that Treasury control is exercised in these circumstances.

Onions

Sir W. Smithers: asked the Minister of Food whether he will make a statement on the present arrangements for marketing onions.

Mr. Strachey: The marketing of onions is being carried out by growers and distributors on the lines usually followed on a free market. The retail price has now, I am happy to say, declined to between 3d. and 4d. per lb. This compares with the former controlled price of 4½d. per lb. As the House knows, we have, reluctantly, suspended imports until 14th December.

Sir W. Smithers: Is not the Minister aware that home-grown onions—and an appeal has been made to people to produce as much food here as possible—are either unsaleable or saleable only at a heavy loss to the grower?

Mr. Strachey: No, Sir, I cannot agree with that.

Sir W. Smithers: I know it.

Mr. Strachey: Well, I cannot agree. They are saleable at the retail prices I have just quoted.

Captain Crookshank: Could the right hon. Gentleman say what he meant by "we have, reluctantly, suspended imports," in view of the fact that there is an enormous home production which is not being sold?

Mr. Strachey: I referred to the fact that I regard the supplies which can be marketed as dependent on the price, in that more will be marketed if the price is reduced.

Mr. Tiffany: Will my right hon. Friend resist the pressure from the Opposition which seems to indicate that more controls are necessary in this direction?

Mr. David Renton: Is the Minister aware that the price farmers are receiving, of about £12 a ton, brings in only lid. per lb., whereas these onions are being sold in the market at 4d. and 6d. a lb.? [HON. MEMBERS: "Twopence a lb."] If the Minister doubts the information I am giving him, I am perfectly prepared to establish that after Question time. Will he please look into this question so as to ensure that the grower gets his fair share of the retail price?

Mr. Strachey: I am sympathetic to the view that the retail price should fall further. It has fallen substantially, and I think it may fall still further.

Mr. Cobb: Will my right hon. Friend note that many of his supporters think that a little bit more competition in this and other ranges of goods will be a good thing?

Major Legge-Bourke: Does not the Minister realise that by allowing onions from abroad to come on the home market at a time when there was a large crop of home-produced onions, he has made a large proportion of home-grown onions unsaleable this year? Is he aware that the onions are going bad, and will he do something at once to dispose of the crop?

Mr. Strachey: We realised that there was a problem here and reluctantly prohibited imports until 14th December. Certainly, I can do no more.

Sir W. Smithers: Is the Minister aware that, like the Government, the home-grown onions are going bad?

BUSINESS OF THE HOUSE

Motion made, and Question put,
That the Proceedings in Committee on the Cinematograph Film Production (Special Loans) Bill be exempted, at this day's

Sitting, from the provisions of Standing Order No. 1 (Sittings of te House)."—(The Prime Minister.)

The House divided: Ayes. 252; Noes, 107.

DivisionNo.34.]
AYES
[3.33p.m.


Acland, Sir Richard
Fairhurst, F
Macpherson, T. (Romford)


Adams, Richard (Balham)
Farthing, W. J.
Mainwaring, W. H.


Alexander, Rt. Hon A. V
Fernyhough, E.
Mallalieu, E L. (Brigg)


Allen, A C (Bosworth)
Fletcher, E G. M. (Islington, E.)
Mallalieu J P W. (Huddersfield)


Allen, Scholefield (Crewe)
Foot, M. M
Mann, Mrs. J


Alpass, J H
Forman, J C.
Manning, C.(Camberwell, N.)


Anderson, A (Motherwell)
Fraser, T (Hamilton)
Manning, Mrs. L (Epping)


Attewell, H C
Gallacher, W
Mathers, Rt. Hon. George


Attlee, Rt. Hon. C. R
Ganley, Mrs C. S
Mellish, R J.


Austin, H. Lewis
Gibbins, J
Middleton, Mrs L


Awbery, S S
Gibson, C W
Monslow, W


Ayles, W H
Gilzean, A
Moody, A S


Ayrton Gould, Mrs. B
Glanville, J. E.(Consett)
Morley, R


Bacon, Miss A
Gooch, E G.
Morris, P (Swansea, W)


Balfour, A
Granville, E. (Eye)
Morris, Hopkin (Carmarthen)


Barstow, P G
Greenwood, Rt. Hon A (Wakefield)
Morrison, Rt Hon H (Lewisham, E.)


Barton, C
Greenwood, A W J (Heywood)
Mort, D L


Battley, J R
Grenfell, D. R.
Murray. J D


Bechervaise, A. E
Grey, C F
Nally, W


Benson, G
Grierson, E
Naylor, T. E


Beswick, F.
Griffiths D (Rother Valley)
Neal, H (Claycross)


Binns, J
Griffiths, W D.(Moss Side)
Nichol, Mrs M E.(Bradford, N.)


Blackburn, A. R
Guest. Dr L. Haden
Nicholls, H R (Stratford)


Blenkinsop, A
Gutter, R J
Noel-Baker, Rt Hon P J (Derby)


Blyton, W R.
Guy, W H
Oldfield, W H


Bowden, Flg. Offr. H W
Hale, Leslie
Oliver, G H


Braddock, Mrs E M (L' pl. Exch' ge)
Hamilton, Lieut -Col. R.
Paling, Rt Hon Wilfred (Wentworth)


Bramall, E A
Hannan, W (Maryhill)
Parker J


Brook, D (Halifax)
Hardy, E. A
Parkin, B T


Brown, T. J (Ince)
Harrison J
Paton, Mrs F (Rushcliffe)


Bruce, Maj D. W. T
Hastings, Dr. Somerville
Paton, J (Norwich)


Burke, W A.
Henderson, Joseph (Ardwick)
Pearson, A


Butler, H W (Hackney, S.)
Herbison, Miss M
Peart, T. F


Callaghan, James
Hobson, C. R
Perrins, W


Carmichael, James
Holmes, H E (Hemsworth)
Piratin, P


Champion, A. J
Horabin, T L
Platts-Mills, J F F.


Chater, D
Hoy, J
Poole, Cecil (Lichfield)


Chetwynd, G R
Hudson, J H (Ealing W.)
Popplewell, E


Cluse, W. S
Hughes, Emrys (S Ayr)
Porter, E (warrington)


Cobb, F A
Hughes, Hector (Aberdeen, N.)
Proctor, W T


Coldrick, W
Hughes, H D (W'lverh'pton, W.)
Pryde, D J


Collick, P
Hynd, H (Hackney, C)
Pursey, Comdr H


Collindridge, F
Hynd, J. B. (Attercliffe)
Rankin, J.


Colman, Miss G M
Irving, W. J. (Tottenham, N.)
Rees-Williams, D. R


Cook, T F
Janner, B
Reeves, J


Corbet, Mrs. F K. (Camb' well, N.W)
Jeger, G (Winchester)
Richards, R


Corlett Dr. J
Jenkins, R H
Roberts, Goronwy (Caernarvonshire)


Cove, W. G.
Johnston, Douglas
Robertson, J. J. (Berwick)


Crawley, A
Jones Elwyn (Plaistow)
Rogers, G. H R


Crossman, R H. S
Keenan, W
Scollan, T.


Cullen, Mrs. A.
Kenyon, C
Scott-Elliott, W


Dagger, G.
Kinghorn, Sqn.-Ldr. E.
Segal, Dr. S


Daines, P
Kinley, J
Sharp, Granville


Davies Rt. Hn. Clement(Montgomery)
Kirby, B V
Shawcross, C N.(Widnes)


Davies, Edward (Burslem)
Kirkwood, Rt Hon D.
Silverman, S S (Nelson)


Davies Haydn (St Pancras, S W.)
Lee, F (Hulme)
Skeffington, A M


Davies S O (Merthyr)
Lee, Miss J (Cannock)
Skeffington-Lodge, T C


Deer, G
Levy, B W
Skinnard, F W


de Freitas, Geoffrey
Lewis, A W. J. (Upton)
Smith, Ellis (Stoke)


Delargy, H J
Lewis, T (Southampton)
Smith, H N (Nottingham, S.)


Dodds, N N
Lipson D.L
Snow, J. W


Donovan, T
Lipton, Lt.-Col. M
Solley, L. J


Driberg, T E N
Logan, D G
Strachey, Rt Hon. J.


Dugdale, J. (W Bromwich)
Longden, F.
Stubbs, A. E


Edelman, M
Lyne, A. W.
Summerskill, Dr Edith


Edwards, Rt Hon Sir C. (Bedwellty)
McAdam, W
Swingler, S.


Edwards, Rt Hon N. (Caerphilly)
McEntee, V La T.
Sylvester, G. O


Edwards, W J (Whitechapel)
McGhee, H G
Symonds, A L


Evans, Albert (Islington. W.)
Mack, J D.
Taylor, R. J. (Morpeth)


Evans, E (Lowestoft)
McKay, J (Wallsend)
Taylor, Dr. S. (Barnet)


Evans, John (Ogmore)
Maclean, N. (Govan)
Thomas, D E.(Aberdare)


Evans, S N (Wednesbury)
McLeavy, F
Thomas, I. O. (Wrekin)


Ewart, R
MacPherson, M. (Stirling)
Thorneycroft, Harry (Clayton)




Thurtle, Ernest
Wallace, H. W. (Walthamstow, E.)
Williams, R. W. (Wigan)


Tiffany, S
Warbey, W N.
Williams, W. R. (Heston)


Timmons, J.
Watson, W. M.
Wilson, Rt. Hon. J H.


Titterington, M. F.
Webb, M.(Bradford, C.)
Wise, Major F. J.


Tolley, L.
Wheatley, Rt. Hn. John (Edinb' gh, E.)
Woodburn, Rt. Hon. A


Tomlinson, Rt. Hon. G
White, H (Derbyshire, N.E.)
Woods, G. S.


Viant, S P
Whiteley, Rt. Hon W
Wyatt, W.


Wadsworth, G
Willey, F T.(Sunderland)
Young, Sir R. (Newton)


Walkden, E.
Willey, O. G. (Cleveland)



Walker, G. H.
Williams, D. J (Neath)
TELLERS FOR THE AYES:


Wallace, G. D (Chislehurst)
Williams, J. L. (Kelvingrove)
Mr. Simmons and Mr. Wilkins.




NOES


Astor, Hon. M.
Head, Brig, A. H.
Ramsay, Maj. S.


Beechman, N. A.
Henderson, John (Cathcart)
Renton, D.


Birch, Nigel
Hinchingbrooke, Viscount
Roberts, H (Handsworth)


Boles, Lt.-Col. D. C. (Wells)
Holmes, Sir J. Stanley (Harwich)
Robertson, Sir D. (Streatham)


Bossom, A C
Hulbert, Wing-Cdr N J
Ross, Sir R D. (Londonderry)


Bower, N.
Hurd, A.
Sanderson, Sir F.


Boyd-Carpenter, J. A.
Hutchison, Lt.-Cm Clark (E'b'rgh W)
Scott, Lord W.


Braithwaite, Lt.-Comdr. J. G
Hutchison, Col. J R. (Glasgow, C)
Shephard, S (Newark)


Bromley-Davenport, Lt.-Col. W
Joynson-Hicks, Hon L W
Shepherd, W. S. (Bucklow)


Buchan-Hepburn, P. G. T.
Kerr, Sir J. Graham
Smithers, Sir W


Bullock, Capt. M.
Lancaster, Col. C. G.
Snadden, W. M.


Butcher, H. W.
Langford-Holt, J.
Stanley, Rt. Hon. O.


Channon, H.
Legge-Bourke, Maj. E. A. H
Stewart, J. Henderson (Fife, E.)


Churchill, Rt. Hon. W. S
Lennox-Boyd, A T.
Stoddart-Scott, Col. M.


Clifton-Brown, Lt.-Col. G
Lucas-Tooth, Sir H
Strauss, Henry (English Universities)


Conant, Maj. R. J. E.
Lyttelton, Rt Hon. O.
Studholme, H G.


Crookshank, Capt. Rt Hon. H F. C
MacAndrew, Col. Sir C.
Sutcliffe, H.


Crosthwaite-Eyre, Col. O. E
Macdonald, Sir P (I. of Wight)
Taylor, C S.(Eastbourne)


Crowder, Capt. John E
McFarlane, C. S.
Teeling, William


Darling, Sir W. Y.
McKie, J H. (Galloway)
Thomas, Ivor (Keighley)


De la Bère, R.
Maclay, Hon J. S
Thomas, J P L.(Hereford)


Digby, S. W.
Maitland, Comdr. J W.
Thorp, Brigadier R A. F


Donner, P W
Manningham-Buffer, R. E
Touche, G C


Drewe, C.
Marlowe, A A. H.
Turton, R. H


Dugdale, Maj. Sir T. (Richmond)
Marples, A. E.
Vane, W. M F


Eccies, D. M.
Marsden, Capt. A
Wheatley, Colonel M. J. (Dorset, E.)


Eden, Rt. Hon A
Moore, Lt.-Col. Sir T.
White, Sir D. (Fareham)


Elliot, Lieut.-Col. Rt. Hon Walter
Morris-Jones, Sir H.
Williams, C. (Torquay)


Erroll, F. J.
Mott-Radclyffe, C E.
Williams, Gerald (Tonbridge)


Fletcher, W.(Bury)
Neven-Spence, Sir B.
Willoughby de Eresby, Lord


Galbraith, Comdr. T. D. (Pollok)
Nield, B (Chester)
Winterton, Rt. Hon. Earl


Gammans, L. D.
Noble, Comdr. A. H. P
York, C.


Glyn, Sir R.
Odey, G. W.
Young, Sir A S. L. (Partick)


Gridley, Sir A.
Orr-Ewing, I. L



Grimston, R V.
Pickthorn, K.
TELLERS FOR THE NOES:


Hannon, Sir P. (Moseley)
Ponsonby, Col. C. E.
Commander Agnew and


Harvey, Air-Comdre. A. V.
Raikes, H. V
Brigadier Mackeson.


Question put, and agreed to.

Orders of the Day — CINEMATOGRAPH FILM PRODUCTION (SPECIAL LOANS) [MONEY]

Resolution reported:
That, for the purposes of any Act of the present Session to make provision for the lending of money to be employed in financing the production or distribution of cinematograph films, and to provide for the taking over by a national corporation established for the purpose aforesaid of the assets and liabilities of National Film Finance Company Limited, and for purposes connected with the matters aforesaid, it is expedient to authorise—

(a) the issue out of the Consolidated Fund of sums required to enable the Board of Trade to make advances to the said corporation within the following limit, namely, that the aggregate amount of the principal outstanding in respect of such advances shall not at any time exceed five million pounds;
(b) the raising under the National Loans Act, 1939, of any money required for the purpose of providing any sums to be issued as aforesaid or for the replacement thereof;
(c) the payment into the Exchequer of sums received by the Board of Trade from the said corporation in respect of advances, and the issue of such sums out of the Consolidated Fund and the application of such sums, in so far as they represent principal in redemption or repayment of debt, and in so far as they represent interest in payment of interest otherwise falling to be paid out of the permanent annual charge for the National Debt,
(d) on the dissolution of the said corporation, the cancellation of the whole or any part of any liability of the said corporation to the Board of Trade;
(e) the payment into the Exchequer of any sums received after the dissolution of the said corporation in respect of any of the property or rights thereof and the payment out of moneys provided by Parliament of any sums required after the dissolution of the said corporation to defray any liabilities thereof."

Orders of the Day — CINEMATOGRAPH FILM PRODUCTION (SPECIAL LOANS) BILL

Considered in Committee.

[Mr. BOWLES in the Chair]

CLAUSE 1.—(The National Film Finance Corporation.)

3.43 p.m.

The Deputy-Chairman: The first four Amendments to this Clause, in the name of the hon. Member for West Fife (Mr. Gallacher) are out of Order, hut his fifth one is in Order.

Mr. Gallacher: I was most concerned, Mr. Bowles, with those first four Amendments.

The Deputy-Chairman: The Money Resolution is very tightly drawn. It refers only to the production and distribution of manufactured films, and not to their showing, so that the hon. Gentleman could not even make a speech about their showing on the Motion "That the Clause stand part of the Bill."

Mr. Gallacher: I beg to move. in page 1, line 17, to leave out:
on a commercially successful basis.'
The production and distribution of films on a commercial basis will, I am sure, prove a big handicap to the production of the type of films we wish to encourage. As the Bill is drawn, distributors will be concerned more with box office successes than with the character of their films. The Money Resolution does not ensure the showing of all films, and good producers with good ideas, men who are often talked of as pioneers in new methods of expression and direction, will be severely handicapped. The making of loans to pioneers cannot possibly be regarded as a successful commercial undertaking, so it would not be a bad idea if the Government took back the Bill and prepared an entirely different scheme which would encourage the independent producers of very desirable films. While trying to cut down costs as much as possible, we should ensure, too, that once the films have been produced they will be shown. What is the sense of getting a distributor to encourage an independent producer to produce films when no provision is made for those films to be shown throughout the country?

Mr. Emrys Hughes: The hon. Member for West Fife (Mr. Gallacher) has put his finger on a very important point, and I hope the President will agree to the deletion of the words suggested in the Amendment. Some good films might not be produced if commercial success is to be the fundamental idea behind this Bill. For instance, a film shown in the House recently was a very good one which should have been shown all over the country. It was called "The World is Rich," and it showed Sir John Boyd Orr explaining his world food plan and putting the case for the International Food Organisation. It would not


have competed with "No Orchids for Miss Blandish," and would not have come under the definition of "a commercially successful basis," as mentioned in the Bill. I ask the President not to subsidise sensational films, but to encourage educational and cultural films.

Mr. Edgar Granville (Eye): On the Second Reading of this Bill the President of the Board of Trade stated that it was not the Government's intention to subsidise this industry, and we have to accept that fact. Therefore, while we all sympathise with those films which may not be regarded from the box office point of view as being commercial successes, nevertheless this Amendment cannot be made. I do not know if the hon. Member for West Fife (Mr. Gallacher) had the feeling that Russian films shown in this country have not proved to be box office successes and, therefore, not commercial successes——

Mr. Gallacher: The whole idea of the Bill is to encourage the independent producers in this country. If I had paid more attention to the Money Resolution I would have had an Amendment down to allow independent producers to get their films shown in the cinemas of the country with the distributors getting their share through the Entertainments Duty.

Mr. Granville: The whole object of the Bill is to try to encourage the independent producers. An Amendment, which we will later consider, in the name of my hon. Friend the Member for Eton and Slough (Mr. Levy), safeguards the position of the independent producer. When we come to distribution, in the long run the independent producer, if he is not to be completely State subsidised, will have to depend upon the box office for the success of his picture. The best security that can be given to him is a fair crack of the whip from Wardour Street, the distributing organisations and the great cinema circuits. If they are prepared to consider each film on its merits, the independent producers' position is safeguarded. It is impossible, therefore, to make this Amendment and equally impossible to remove the commercial test.

Mr. McKie: As we have had three speeches from varying political

points of view, including two from Scotland, it might perhaps be appropriate if a Conservative member from Scotland put his point of view. I appeal to the President of the Board of Trade more on the lines of the appeal of the hon. Member for Eye (Mr. Granville). I hope the President will turn down the Amendment. I have considerable sympathy with some of the points which he made. I want to safeguard the position of the independent producer as much as he does, but we are dealing with public money, and I have not the same complete disregard for public funds as the hon. Member for West Fife. When the Government subsidise an industry it has to be shown how far the subsidy is successful by the results which will be produced. The President of the Board of Trade—and I am glad to see he is agreeing with me—would agree that it is far wiser to leave these words in the Bill.
The hon. Member for West Fife (Mr. Gallacher) knows perfectly well that it is the box office which at the end of the day will show whether a film has been worth seeing or not.

Mr. Gallacher: No.

Mr. McKie: The hon. Member says "No." We are in Committee, and it is open to him to follow me and point out where I am wrong. I thought he would have agreed that the success of a film must be judged at the end of the day, ipso facto, by how many people desired to see that film by purchasing tickets at the box office. The hon. Member went on to plead for the necessity to encourage the independent producer. I agree with the President of the Board of Trade that we have to be governed by the public interests in how we expend public money. I have not had the opportunity in London during the times when the House is not sitting of seeing——

Mr. Gallacher: If an independent producer had an idea and was capable of producing what was recognised to be a really valuable educational and cultural film, but it was quite obvious that it would not be a commercial proposition, would the hon. Member for Galloway (Mr. McKie) say that in no circumstances should he be allowed to assist in the production of such a film?

Mr. McKie: Certainly not, but here we are enunciating the general principle


that we are dealing with public money. Therefore, it would be unwise, the draft of this Bill having incorporated these words, for the President of the Board of Trade to withdraw them. When I was interrupted I was about to say that I had not had the opportunity of seeing a film which was produced with a tremendous outlay of money, and which deals with Scotland, entitled "Bonnie Prince Charlie." It received a bad Press though I am told that the photography was very good. Undoubtedly it must have resulted in a considerable loss of money, and as far as the West End of London was concerned it was not showing well. I use that by way of illustration to show what can happen. I hope the President of the Board of Trade will suggest to the Committee the propriety of leaving these words in the Bill and turning down the Amendment.

The President of the Board of Trade (Mr. Harold Wilson): This Amendment aims right at the heart of this Bill and I hope it will be rejected. The essence of this Bill, which was agreed to in all quarters of the House on Second Reading, is aimed at providing temporary assistance to this industry in order that as quickly as possible it may put itself on a sound commercial basis. If at the very outset of the Committee stage we try to destroy that idea, then this Bill is not only doomed to failure, but, in consequence, the film industry as a whole is going to be very seriously affected.
I have a certain sympathy, as has the hon. Member for South Ayrshire (Mr. Emrys Hughes) and the hon. Member for Eye (Mr. Granville), with the idea put forward by the hon. Member for West Fife (Mr. Gallacher), when he referred to the difficulties of independant producers, among whom there are certain types of genius, who have some new idea and cannot get facilities for production for that idea. However, as I said on Second Reading, I am quite sure we cannot use public money for the purpose of finding out whether a particular producer is or is not a genius. In any case, I am sure public opinion would not countenance the expenditure of the taxpayers' money on an industry with a non-commercial basis when the industry is well known to have such high-class, and, in some cases, such lavish standards of expenditure in certain directions.
The hon. Member for West Fife said he felt there might be desirable films of great cultural value. Of course, it is just possible that some other members of the Committee and I would not agree with him as to what is a desirable or a cultural film. In any case, I do not think it would be right for a body set up with public money, voted by this House, to concern itself with deciding which are desirable and cultural films to be subsidised in this way. The hon. Member for South Ayrshire referred to an excellent film, "The World is Rich." That film has been produced. No one could say that it was not produced because of lack of money. As the hon. Member says, the big problem was the failure, not to produce but to get a showing.
4.0 p.m.
Any kind of subsidy on the lines suggested by the hon. Member for West Fife would not solve the problem of the exhibition of a film when produced. If there is to be a future for that type of film, and I join with the hon. Gentleman in hoping that there is a very big future for it, the problem is not that of providing finance upon a non-commercial basis, but of getting a fair show from exhibitors, and a fair return from them for the right to show the film. To go into that question would mean going into a matter which we shall perhaps discuss on an Amendment in the name of one of my hon. Friends, in connection with a committee of inquiry. I am sure that it would be wrong for me to recommend to the Committee to accept this Amendment. I hope therefore that it will be rejected.

Amendment negatived.

The following Amendment stood upon the Order Paper in the name of Mr. LEVY:

Page 2, line 3, at end, insert:
and;
(c) to utilise the funds at its disposal for the establishment of a distribution company exercising the same functions as the main existing distribution companies.

The Deputy-Chairman: This Amendment is out of Order, and will not be called.

Mr. Benn Levy: On a point of Order. If the Amendment is out of Order, may I be given the reason? I understand that the reason why the previous Amendments were out


of Order was that they dealt with exhibition. This Amendment does not do so.

The Deputy-Chairman: It is out of Order because it is outside the Title and scope of the Bill and outside the Money Resolution, and it seeks to encourage a company to enter into the business itself. A public charge is asked for in the Bill for the purpose of subsidising the production and distribution of films. The hon. Gentleman's Amendment is as completely out of Order as were the the others to which he referred.
Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. Gallacher: I am sorry that the Minister did not accept my Amendment. I insist that it is a mistake to tie the hands of the Corporation and of the distributors. I am not suggesting that the distributors and the Corporation should subsidise film production, but surely if a film is being produced, the distributors and the Corporation must be satisfied that it would be desirable to have that film and to encourage it and to ensure its showing. Why should their hands be tied and they be prohibited from assisting a case of that kind? I cannot understand the attitude that has been adopted in connection with this matter.
I am certain that if they were given a greater measure of discretion and were not tied down by the box office they could easily get films that were worth showing. It is easy to get films that are not worth showing from the standpoint of morals, education and culture, and which should be prohibited. but which are a big box office draw. That is because of tastes that have been deliberately cultivated by certain sections of the film industry. We should remember that hon. Members on the other side of the House have never been very interested in free education for the people or in anything of that kind. [HON. MEMBERS: "Oh."] Oh, yes, there is a long history of struggle about the people getting education, and it has been a struggle against representatives of the other side.

The Deputy-Chairman: The hon. Member is going very much too wide in his argument. The Clause deals simply with

the finance related to the production and distribution of films. The hon. Gentleman must not re-argue his Amendment.

Mr. Gallacher: I will only say in conclusion that this is a further indication of how a valuable means of education can be held back by Tory commercialism.

Mr. Levy: On a point of Order. As the Amendment in my name has been ruled out of Order, I take it, Mr. Bowles, that I shall be in Order in speaking on the Clause and in pointing out some of the shortcomings in the Clause which it was the purpose of the Amendment to correct.

The Deputy-Chairman: So long as the hon. Gentleman confines himself to what is in the Clause, he may say that there are shortcomings and then he will be in Order.

Mr. Granville: Do I understand that you have ruled out of Order the Amendment in the name of the hon. Member for Eton and Slough (Mr. Levy)?

The Deputy-Chairman: Yes. That Amendment has been ruled out of Order and the Ruling has been accepted by the Committee. We are now discussing the Question "That the Clause stand part of the Bill."

Mr. Levy: During the Second Reading it was pointed out that one of the shortcomings of the Clause was that the purpose of helping the genuine independent producer would not be achieved. That was felt to be the case because certain conditions are imposed which make it necessary for a distribution company to pledge its assets before it can proceed. For that reason it was felt that they would do anything they could to raise money by other means and to dispense with that necessity. My own feeling has been that the terms imposed are not sufficiently stringent to safeguard public money. For that purpose I have on the Order Paper certain Amendments which call for more stringent conditions to make it still more improbable that the Bill will not achieve its objective and will become a dead letter. It would not be in Order for me to refer to the corrective which I have in mind.
There is an additional difficulty, which is to define what is an independent producer. During the Second Reading


and before, it was clear, as my hon. Friend the Member for West Fife (Mr. Gallacher) has said, that the Bill has been put forward with the design of helping the independent producers and it has been accepted as that, for very good reasons. It has been generally felt that this is the kind of industry in which a monopoly or a near-monopoly is highly undesirable and that by helping independent producers we tend towards some mitigation of the existing quasi-monopoly or near-monopoly situation. I do not think that it would be contended in any part of the Committee that a monopoly, either private or public, of a means of self-expression such as this, should be encouraged. One of the reasons which commended the Bill to the House was that it tended to mitigate the monopoly situation.
I therefore attempted to define what was an independent producer, or rather I borrowed a definition which was put forward by the Gater Commission. It was a strictly limited definition, and my right hon. Friend had no difficulty in subjecting it to a reductio ad absurdum. He said:
The more we pursue that form of definition the more we shall get to the point where the independent producer will be defined as a producer who is not producing."—[OFFICIAL REPORT, 2nd December, 1948; Vol. 458, c. 2275.]
I cannot deny that it could be done, but any alternative definition on which the right hon. Gentleman might venture—he is being understandingly prudent in not doing so—could equally be reduced to a reductio ad absurdum. We are reaching the position where any of Mr. Rank's producers might be defined as independent producers so long as they had an independent right to choose their own directors. Surely, the definition ought to be one who is not integrated either de jure or de facto into one of the two major combines. Surely that is a sensible definition, although I agree that it cannot be a legal one. If we have that difficulty, it is a difficulty which can be got round by a method which I am prohibited from mentioning.
There is a further reason. At present, film-making is not a profit-making business. It has been demonstrated on all sides of the Committee that one makes a film with very small prospects of getting one's money back, but so long as it is

not a profit-making business, the £5 million which the Bill proposes to lend will either not be used, for the reasons I have given, or, as the right hon. Member for Aldershot (Mr. Lyttelton) implied, it may be lost. Surely therefore, it is very important that we should have adequate safeguards. I do not see any other method of applying those safeguards except through the means of the second Amendment in my name on the Order Paper, in Clause 2, page 2, line 38. That is a very second best and rather unsatisfactory method of doing it. I am in very great difficulty——

The Deputy-Chairman: Perhaps I may help the hon. Gentleman out of his difficulty. Some of his speech is more appropriate to the second Amendment, and he would not find himself in so much difficulty if he spoke on that. He has been rather wide on the Question that the Clause stand part.

Mr. Levy: I am grateful for that suggestion, Mr. Bowles, and I should like to take advantage of it.

Mr. William Shepherd: There are one or two points I should like the President of the Board of Trade to clear up. I want, first of all, to know whether there is in existence or in contemplation a limit on the amount of money which could be loaned to one distributing company.

The Deputy-Chairman: That subject can be taken much more conveniently on the Question that Clause 2 stand part.

Mr. Shepherd: I have one or two other points which, I hope, come under this Clause. I want to ask the President of the Board of Trade whether a cooperative of exhibitors would qualify for financial assistance if it were established in the form of a distribution company similar to those operating at the present time. I think there is a solution to the problem of the film industry if the independent exhibitors get together and form their own renting organisation. If that happens, would they be able to receive assistance under the Bill?
I also want to know the attitude of the Government or the Corporation towards the circuits. Is it possible for circuits to get loans under the Bill? Let us take the case of the organisation of the hon. Member for East Islington (Mr. E. Fletcher)


which owns 447 cinemas, as against the Rank organisation's 550, and makes little or no contribution towards the production of films in this country. Could that company borrow money in order to play the part which it ought to be playing in producing films, or must it continue to try to give somebody else the sticky end and grab the profitable end itself. My last question relates to Members of Parliament. I notice that, apparently, Members of Parliament can be directors of the Corporation. At least, there is no specific exclusion. Is it in order for Members of Parliament to be directors of the Corporation?

4.15 p.m.

Mr. Rankin: I have two points to put to the President of the Board of Trade which follow, to some extent, a case which has been put forward. An hon. Member has deplored that there is no provision for the production or distribution of cultural and educational films, which, I think, would be welcomed by the hon. Member for Galloway (Mr. McKie). I am sure that if the delights of Galloway were transferred to the silver screen it would result in a repopulation of an area which, I am certain, would be welcomed by the hon. Member who at present represents that part.

Mr. McKie: Mr. McKie rose——

The Deputy-Chairman: No, the hon. Member for Galloway (Mr. McKie) cannot interrupt. The hon. Member for Tradeston (Mr. Rankin) has himself already been out of Order.

Mr. Rankin: I will leave that point. All I want to be assured about is the wording of the Clause. We can read it in such a fashion as to enable us to say that provision should be made by the National Film Finance Corporation for the production and distribution of films of this nature. There is nothing in the present wording to prevent the Corporation from carrying out the type of work about which the hon. Member for West Fife (Mr. Gallacher) has spoken. As I read the Clause, they have that power, provided that it can be carried out on a commercially successful basis, and there is no reason to assume that it could not be. I suggest that the Clause enables that to be done.
The second point relates to the granting of money by the National Finance Corporation when money cannot be obtained from any other appropriate source. If an independent producer comes forward with a proposition for which he has been unable to get financial backing from what is called "an appropriate source," would the Corporation use that as an argument for saying that they in turn could not provide money for the purpose? As the words stand, that argument might be used against an independent producer. Will my right hon. Friend give us an assurance that that type of argument will not be used?

Mr. Eric Fletcher: May I raise a point of general interest in view of the discussion initiated just now by the hon. Member for West Fife (Mr. Gallacher)? I think the President of the Board of Trade was perfectly right in resisting that Amendment, because it is the underlying assumption of this Bill that the public money which will be advanced to this Corporation will be used on a commercial basis. In view of the discussion, I think that this Committee and the public ought to know from the President of the Board of Trade rather more than we know at present about the matters in respect of which this Corporation will have to exercise its judgment. As I understand the wording of the Clause, the Corporation will have the right to lend sums of money to persons engaged in film distribution to enable those persons to have a sufficient amount of credit to finance production or distribution.
There seems to have arisen from this discussion a misapprehension in the minds of certain hon. Members, and I am raising this matter in order that the President of the Board of Trade may correct me if I am wrong. As I understand the language of the Clause, it will not be for the Corporation to say. "We think that such and such a projected film will be a good film—or will be a commercially successful film—or will be the kind of film which we think ought to be made." If that is the duty which is being cast on the Corporation, we should know, because it is a pretty thankless task since the ultimate arbiters of public taste are the public themselves; they will be the final judges whether whoever decides to make films, A, B and C has exercised his judgment correctly.
As I understand it, all the Corporation has to exercise a discretion about is whether the people to whom it will lend the money are people whose prestige and reputation are such as to make it seem a reasonably prudent course to lend money to them. This is important because questions will no doubt arise hereafter as to how far questions can be raised in this House with regard to the administration of this money, and with regard to the exercise by the Corporation of its judgment.

Mr. Gallacher: The hon. Member has great experience and he says that the people must be the final judges. How is the distributing agency to form any opinion as to whether a film to be produced by an independent producer will or will not be commercially successful?

Mr. Fletcher: Does the hon. Member mean before the film is made or after?

Mr. Gallacher: Before.

Mr. Fletcher: Obviously one cannot tell before a film is made how it will be when it is made.

Mr. McKie: I should not have risen but for the intervention of the hon. Member for Tradeston (Mr. Rankin). I shall only refer to the first part of his speech, Mr. Bowles.

The Deputy-Chairman: The first part of the hon. Member's speech was out of Order.

Mr. McKie: With great respect, Mr. Bowles, the hon. Gentleman was allowed to say certain things before he was called to Order.

The Deputy-Chairman: It was ruled in the pluperfect that the hon. Member had already been out of Order.

Mr. Blackburn: There is a point of considerable substance here which may be overlooked, and which turns upon the definition of the persons who may receive money. As I see it, this Bill only gives the Corporation power to advance money in respect of one film. That seems to me to be a mistake, and I cannot believe that the President of the Board of Trade intended it or that the Committee intended it. This Clause says the money can be given to
persons who, in the judgment of the Corporation, while having reasonable expectations

of being able to arrange for the production or distribution of cinematograph films on a commercially successful basis….
I understand that so far it has been the practice of the company to follow this. In other words, the Corporation will not grant money to an independent producer who comes forward with one film only. I should like clarification of this matter. If I am wrong, I shall be only too delighted to know. Our main object is to try to give the small man a chance, and it would be ridiculous if we gave a man a chance only if he proposed to make more than one film. If the object of the Clause is, as we all agree, to give independent producers a chance, the smaller the independent producer the better, and if he makes only one film, then on certain conditions as to cost, that ought to be possible.

Mr. S. O. Davies: Once this Corporation is established, what powers will Parliament have, through the President of the Board of Trade, over its activities? Will Parliament be free to seek information and to discuss the administration of the Corporation?

The Deputy-Chairman: I think the speech of the hon. Member will come better on Clause 3.

Mr. Davies: I thought that since we were discussing the Corporation on Clause 1 and, as it were, bringing it into being, I should be entitled to have an answer now. If Clause 1 is passed, I might be ruled out of Order on Clause 3 because the Corporation has been disposed of previously.

The Deputy-Chairman: No. The Corporation is formed under this Clause, but Clause 3 provides for the Board of Trade to give directions to the Corporation, etc. I think the hon. Member will find that is the right place.

Mr. Granville: Does it mean that a new distributing or renting company can qualify under this Clause for the provisions of the Bill if it is set up after the passing of this Measure? I will not refer to the Amendment which was rule out of Order, but it is important to know that a new renting and distributing organisation would be allowed to set itself up under Clause 1. With regard to the persons


from whom the members of the Corporation will be selected, the Clause says that they must have experience
in matters relating to finance, industry, commerce, administration or law.
Is it intended also to co-opt somebody with experience and knowledge of films?

Mr. Wyatt: May I address myself for a moment to the following passage in Clause 1:
having reasonable expectations of being able to arrange for the production or distribution of cinematograph films on a commercially successful basis…
I hope that the President will tell us exactly what is meant by reasonable expectations of making a commercial success. Hon. Members opposite, and also my hon. Friend the Member for East Islington (Mr. E. Fletcher), have been emphasising this afternoon that the ultimate test of a film is whether or not people will pay for it at the box office. I submit that this is not a correct test to apply in this particular case. It can well be applied to the case of, say, national newspapers or periodicals or things that can be produced fairly cheaply and do not need a tremendous bulk sale in order that they may be published. I am sure the noble Lord would not want to enter into a field of inverse censorship, which he would be doing——

4.30 p.m.

Earl Winterton: Perhaps the hon. Gentleman will be good enough to leave me out of the discussion. I have not taken part in it and I have no intention of doing so. My listening to what has taken place so far has not given me a very favourable impression of the Committee.

Mr. Blackburn: On a point of Order, Mr. Bowles. Is it in Order for an hon. Member to make remarks which are insulting to the Committee as a whole?

The Deputy-Chairman: As the remarks of the noble Lord appear to have been a reflection on the Committee of the Whole House, I think he should qualify what he has just said.

Earl Winterton: The hon. Member for Aston (Mr. Wyatt) referred to me. I have not taken part or made any Interruptions in the Debate and I said

that the effect on my mind was not a favourable one. Do you rule that that was out of Order, Mr. Bowles?

The Deputy-Chairman: I think the noble Lord went very much further than that. He said he had a very unfavourable opinion of the Committee.

Earl Winterton: I am very much obliged to you, Mr. Bowles. I quite agree it was an unfortunate phrase, that the effect of my listening was not a favourable one.

Mr. Gallacher: Further to that point of Order. As the noble Lord has made a comment on the low level of the Debate, is it not desirable that he should be brought in, in order to elevate the level of the discussion?

Earl Winterton: I should now like to raise a point of Order myself. Is it not quite unusual, when an hon. Member is accused—in my case, I admit, very rarely—for there to be no interruption? My name was brought into the discussion and I should like to know what I have to do with this particular Clause?

The Deputy-Chairman: I do not think that is a point of Order. It is quite a common thing, as the noble Lord is aware, for hon. Members to refer to other hon. Members who have not spoken in the particular Debate or even in this Parliament.

Earl Winterton: May I raise a further point of Order, Mr. Bowles? I am anxious to get your Ruling completely clear. I understand that you do not rule that there is anything wrong in my rising to refute what the hon. Member had said and that it was only my method of approach to it which you thought was, perhaps, undesirable.

The Deputy-Chairman: I think the noble Lord was casting a reflection on this Committee of the House. That was quite out of Order and I so ruled.

Earl Winterton: I am quite prepared to withdraw but, for future reference, I should very much like to know—it is a matter I might want to raise on another occasion—what were the exact words which you thought reflected on the discussion. I said that the effect of the discussion on my mind was not favourable.

The Deputy-Chairman: I thought the noble Lord said that he had a very unfavourable view of the Committee. That was wrong, and I think he has withdrawn once. If he did not understand what he was withdrawing, perhaps he will withdraw again.

Earl Winterton: I will most certainly do so. I should like to say that the effect of the discussion upon my mind was unfavourable and I am very anxious, Mr. Bowles, if you would be good enough to do so, that you should now tell me, on a further point of Order, if that statement is in Order.

The Deputy-Chairman: I do not think the noble Lord has withdrawn his previous reflection on the Committee.

Earl Winterton: I had already withdrawn, Mr. Bowles, and perhaps I may be allowed to thank you for your great courtesy in calling my attention to the matter.

Mr. Wyatt: I am very sorry that the noble Lord did not intend to get dragged into this Debate because at the moment he seems to be in it right up to the neck.

Earl Winterton: On a further point of Order, may I say that, the Chair having called my attention to what the Chair described as being out of Order, I at once withdrew to the Chair and not to the hon. Gentleman. If the hon. Gentleman wishes to pursue this matter at the risk of having several more points of Order, we can keep them going, if necessary, for half an hour and I shall be glad to do so.

Mr. Levy: On a point of Order. As I understand it, the noble Lord previously apologised for his impertinent strictures upon the Committee. Now, as I understand it, he is withdrawing that apology to the Committee and trying to reduce it both in quality and in quantity.

The Deputy-Chairman: I think we ought to get on with the Debate.

Earl Winterton: I desire to call your attention, Mr. Bowles, to this further reflection which has just been made. You, Sir, very graciously accepted the withdrawal—if I may so say, the very proper withdrawal—that I made and the hon. Member for Eton and Slough (Mr. Levy), under the guise of a point of

Order, has made a most offensive attack upon me. He has described my statement as impertinent. When an hon. or right hon. Gentleman has withdrawn a statement is it in Order for another hon. Member to get up and further press the matter by describing that statement as impertinent?

The Deputy-Chairman: On the whole, I think that the hon. Member should not have done so, but I do not think he was out of Order. Now, can we get on with the discussion? Mr. Wyatt.

Earl Winterton: May I ask you, Mr. Bowles, whether it is or is not out of Order? I have always understood that when a statement—made inadvertently and, as I have said, not intended to be a reflection—has been withdrawn, the matter was then disposed of. The hon. Gentleman has now got up and, under the guise of a point of Order, has stated, without any rebuke from you, that my action was impertinent. I would respectfully ask you whether he should be asked to withdraw.

The Deputy-Chairman: I think it would be much more sensible if we got on with the Debate.

Mr. Wyatt: Whatever may be our views on the Clause, there is no doubt that had the last seven or eight minutes of our proceedings been screened they would have been an undoubted comrnercial success.
The point I was trying to make—I dare not even refer at the moment to a certain right hon. Gentleman opposite—was that it would be a mistake to impose too much duty on the Corporation to satisfy itself that the film or films to be financed would be definite commercial successes. I was trying to explain that in the world of newspapers, periodicals or other means of communication and information, it is comparatively simple to start a means of communication with a small circulation, so that all classes of the community may receive such matter as they would like, of whatever kind, even if it were Trotskyist, esoteric or anything else. With a film, however, this would be very much more difficult. If, because the costs of producing a film are so high, there is imposed a heavy onus to make quite certain before the film is produced that it will be a box office


winner, we may be depriving large sections of the community of the opportunity of seeing a certain type of film which they want to see because of the feeling that it may not be commercially successful.

Mr. H. Wilson: A number of points have been raised in this discussion. I hope I shall have a chance to reply more fully to some of them when we come to Clause 2. Many of the questions about the Corporation's procedure and course of action might be more fully dealt with at that stage.
The hon. Member for West Fife (Mr. Gallacher) returned to his point about films of cultural value. I want him to get out of his head, if he will, the idea that films of great cultural value are not being made at present, even at a loss. The general tenor of his remarks suggested that under the present organisation of the industry no film can be made if it involves a loss and that, therefore, the Corporation ought to step in to finance the production of such films. Without making any invidious comments——

Mr. Gallacher: Is it not clear that if it were certain that a film would be a commercial success the boys on the other side would be on it and, therefore, a Corporation of this kind would not be needed?

Mr. Wilson: What the hon. Member for West Fife really means, I think, is the film industry. That was a roundabout way of referring to them.

Mr. Gallacher: No, I was referring to finance as represented by the other side. If they are certain that a film will be a commercial success, they will be in on it to reap the profits.

Mr. Wilson: I do not want to pursue that very long and interesting subject this afternoon. What I was saying, and what the hon. Member for West Fife (Mr. Gallacher) does not seem to realise, is that there are many films of great cultural value which, apparently, under present conditions can only be made at a loss, and are being made at a loss, by existing firms in the industry. If the noble Lord would allow me, I was going to call him as a witness on this and I hope he has got over his hypersensitivity on the point.

Earl Winterton: May I say, without being hypersensitive on the point, that I hope the right hon. Gentleman will not cause me inadvertently to say something in reply which would be out of Order?

Mr. Wyatt: Is it in Order for the noble Lord to threaten to hold up the Debate by raising points of Order for half an hour, or something of that kind, if something is said with which he does not agree?

The Deputy-Chairman: I do not think the noble Lord said anything of the kind, but he said that he might be provoked into replying and might, inadvertently, be out of Order.

Mr. Wilson: What I was going to say could not have provoked the noble Lord to get out of Order. I was going to say that the Rank organisation, and the same is true of the Alexander Korda organisation, have been responsible for films of great cultural value, which have been produced at a loss, and it was known before production was started that there would be a loss but they contributed to the prestige value of British films abroad. If films of this kind are produced, the idea must be to recoup the losses by films of perhaps a different type.
My hon. Friend the Member for Eton and Slough (Mr. Levy), skating delicately round the Amendment which was not called, raised a question about distribution, and a number of other questions of a different kind were raised by the hon. Member for Bucklow (Mr. W. Shepherd), the hon. Member for Eye (Mr. Granville) and one or two other hon. Members. I hope I would not be out of Order if I said that if a new distribution company were established and if it were engaged in financing production, it could certainly receive assistance from the Corporation. For instance, if the freelance producers were to get together in order to form a distribution agency, or if the independent producers got together to form such an agency, and that agency required capital for financing a project, it could go to the Corporation. What the Corporation cannot do, is to take the initiative in establishing such a distribution organisation, nor would it be empowered to spend money in encouraging any of the ancillary services required for setting up a distribution agency. Undoubtedly any


new agency to be established could go to the Corporation for assistance.
My hon. Friend the Member for Eton and Slough went on to the very interesting point, which he has discussed before, of the definition of the independent producer. He rather suggested that I had been cautious in not venturing a definition, but I have ventured a definition of independent producers earlier this year in reply to a question by my hon. Friend the Member for Aston (Mr. Wyatt). It was necessary to have a definition of independent producers in connection with the operation of a Section of the Films Act passed this year, which relates to the showing of such films on the major circuits by independent producers. My definition, which must be a rough one, is that for the purposes of convenience we might take producers not connected with the major circuits or American film interests. But I am not certain that that is very relevant to this Bill. As I said on Second Reading, one of the most important things arising out of the scheme described in the Bill has been the maintenance in production of a number of producers who might, or might not, fall within the definition, but whose production is vital to the maintenance of the cinema industry in this country.

4.45 p.m.

Mr. Levy: The point my right hon. Friend is making is that if we want to help the industry, that should not exclude helping the major combines as well; but, after all, the Bill has not been presented in that fashion, but as a Bill to help independent producers. I can quote my right hon. Friend on that in his Second Reading speech.

Mr. Wilson: I can quote myself on it, but the point is that there are a considerable number of independent producers, not in any way directly associated with major circuits, who, if given the finance, could produce against the production guarantee of the organisations, but are prevented from doing so by lack of finance, and with that group I was more concerned than with the major producers of the big circuits. I believe I have answered the hon. Member for Bucklow, but he also asked if it was possible for Members of Parliament to be members of the Corporation. If he turns to the Schedule,

he will find they are not eligible for appointment.—[Laughter.] I do not know whether the right hon. Member for Aldershot (Mr. Lyttelton) has ambitions in that direction, but he could always resign his seat and consider it.
My hon. Friend the Member for Tradeston (Mr. Rankin) raised a very interesting point in connection with the phrase "commercially successful basis," and asked whether a failure on the part of a particular producer to be able to raise money through normal commercial channels would be quoted against him as meaning that his project was not in fact commercial. The answer is quite definitely "No," because if that kind of answer could be given there would be no need for a corporation. The Corporation is being set up to fill a gap in the provision of money for film production.

Mr. Gallacher: This is very important. Are we to take it that if the ordinary financial concerns are satisfied that it is not a successful undertaking, the Corporation have the power to loan money, with the knowledge that outside financiers consider that it will not be a success?

Mr. Wilson: The hon. Member has got it wrong again. The whole point is that it is possible for a film, or a batch of films, to be capable of being produced on a sound commercial basis, but still possible for the producer not to be able to raise the money through normal channels. There is a lack of confidence and, although the thing may be commercially sound, there may not be means of raising money for it. That is why the Corporation is to be established.
My hon. Friend the Member for King's Norton (Mr. Blackburn) raised a question which would be better raised on Clause 2. He asked whether the wording of Clause 1 prevents the financing of individual projects. He will find from what I said on Second Reading that the wording does not in any way prevent the financing of a project of a single firm. The hon. Member for Eye asked a question, having read out the type of person who shall be appointed, whether this means that we shall be able to co-opt someone with knowledge of the film industry. Of course, a person could be co-opted under the phrase
matters relating to finance, industry, commerce and so on.


But I should be very chary of appointing anyone from the film industry, because they must have a certain interest in a circuit, or American interests, or particular groups of one kind or another, and it would be extremely difficult to find any one person in the industry sufficiently independent to help in the work of advancing money for film production. It may well be that one or more of the persons appointed may have some knowledge of the film industry but I do not intend to appoint any one directly from the film industry.

Mr. E. Fletcher: Will my right hon. Friend deal with the point which I raised, and say whether or not it is any part of the function of the Corporation to deal with the merits of any particular film which is being produced, or whether their concern is merely to approve the reputation and prestige of the distributor to whom the money is to be lent?

Mr. Wilson: That was one of the questions to which I was referring when I said that I thought certain matters could be better dealt with on Clause 2 than on this Clause. Perhaps my hon. Friend will leave the matter until we reach Clause 2.

Clause ordered to stand part of the Bill.

CLAUSE 2.—(Loans by the Corporation.)

Mr. Oliver Lyttelton: I beg to move, in page 2, line 29, at the end, to insert:
(3) The Corporation may make a loan to any person in respect of whom the circumstances set out in paragraph (b) of subsection (1) of section one of this Act apply for the purpose of financing the production of a cinematograph film and in considering the propriety of making such a loan shall have regard to the sufficiency of the security for its repayment:
Provided that a loan shall not be made under this subsection unless the Corporation are satisfied that the person to whom the loan is to be made will himself bear not less than one quarter of the total expenditure and liabilities incurred in the production and distribution of such film.
If Clause 1 has proved to be rather a "feature" I hope this Amendment can be classified as a "quickie." It deals with a small point. I do not intend to repeat what was said on Second Reading, but the feeling of those of us on this side

of the Committee, which I think had some support on the other side, was that the operative part of Clause 2 was contained in the proviso.
except in such classes of case as the Board of Trade may approve …
The object of this Amendment is to give the operative part of the Clause a more positive shape. In what I am now saying I am also referring to the following four Amendments standing in my name: In page 2, line 30, leave out from "Corporation," to "make," in line 31, and insert "may."
In page 2, line 32, leave out "unless he is."
In page 2, line 34, leave out "and," and insert "where."
In page 2, line 35, at end, insert:
(4) Save as provided in the two last foregoing subsections the Corporation shall not, except in such classes of case as the Board of Trade may approve, make a loan to any person.
These are all consequential upon the main Amendment. We think that it improves the Bill to state that the object of the Corporation is to make loans to those people who are described in Clause 1 (1, b) upon two criteria, the first having regard "to the sufficiency of the security" which are very general words; and the second that the loan shall be subject to the independent producer, because he is the man referred to, or his backers, having taken 25 per cent. of the risk. That, I think, is the common form in this type of finance. It is exactly the same as when the Export Credits Department of the Board of Trade, for example, insure contracts abroad; it expects the shipper or producer to take at least the risk of all his profit upon the transaction. So I think that in making these loans to independent producers, the Board of Trade should be satisfied that those producers or their backers are at any rate involved in the risk to the tune of 25 per cent. of the total cost. The aim of the Amendment is to clear up the Clause generally and to bring the main object of the Bill to the forefront instead of leaving it in this contingency Clause. We are not wedded to the exact words of the Amendment, and if the right hon. Gentleman will give us a sympathetic answer on the general object of the Amendment, that will suffice.

Mr. H. Wilson: I agree with the right hon. Gentleman in that I do not think


we desire to go over the whole of the Second Reading Debate on this question of direct aid to production itself. The view of the House was expressed by Members on all sides on that point, Although I agreed that this Clause was rather negatively worded, I hope that I satisfied the House that it was our intention, as soon as we can work out the necessary safeguards, to enable finance to be provided directly for production and not merely through distribution companies. So far as the Amendment is concerned, I have a lot of sympathy with the aim of the right hon. Gentleman in trying to make this Clause more positive in its wording. The present wording is rather negative and if we could have found a more warmhearted and positive way of saying what we are trying to do, we would have done so. Since the right hon. Gentleman put down this Amendment our legal advisers have tried to find some more positive and warmhearted way of doing it, but we have not been able to find any way which is not much more clumsy, and which I think would be more offensive to the right hon. Gentleman's well-known love of good English and good drafting.
Perhaps if I say what we intend to do under this Clause, and what the effect of what is referred to as the contingency Clause is to be, I can give the right hon. Gentleman the assurance he wants. Before I do that I would say of his own Amendment that I disagree fundamentally with the second part of it, namely, the requirement that any producer must be able to put up 25 per cent. of the backing. That would mean that the producing company would have to find the whole or almost the whole of what, on Second Reading, we called the "end money," that very difficult 25 per cent. which has in the past been standing in the way of an expansion of film production. Indeed, if we were to do as the right hon. Gentleman suggests I do not think that there would be any room in the industry for the work of the Corporation, unless we were putting in the Corporation to usurp the proper functions of the bank. It is the normal position, as the right hon. Gentleman said in his speech on Second Reading, that a certain proportion, which has often been 25 per cent. has had to be put up by the producer and the rest has been covered by the banks. If we were to provide here that the producer has to

provide 25 per cent. and the Corporation the remainder, the Corporation would in fact be standing in the position of the banks.

Mr. Lyttelton: The right hon. Gentleman will agree that this Amendment covers only one of the avenues of finance which are open to the Corporation? There are others.

Mr. Wilson: I quite agree.

Mr. Granville: At the same time will the right hon. Gentleman bear in mind that if this qualification was insisted upon many important films of a semi-cultural character would never have been made— "Man of Aran," for example?

Mr. Wilson: I think that we all have the same point in mind. We regard it as essential that we should have as many safeguards as possible to see that producers do not come along to risk State money without risking that of anyone else. That is why we put in the phrase which the right hon. Gentleman did not like,
except in such classes of case as the Board of Trade may approve,
because I do not think we should lay down hard and fast rules as to how the Corporation should finance independent production. It would be wrong to tie them down to insisting upon a 25 per cent. guarantee by the producers themselves. It is probably quite right that except in the approved classes of case referred to the Corporation should not be at liberty to make direct loans to producers who cannot put up the money themselves or furnish completion or distribution guarantees from their renters. It would not be easy to find words the effect of which would not be to tie the Corporation hand and foot for some period to come and would not have a restrictive effect upon what we all want to do.

Mr. Lyttelton: I am not quite following the argument of the President of the Board of Trade, because under the Clause as it would be redrafted if the Amendment were accepted, it would still be open to the Corporation to make loans through the distributor in special cases approved by the Board of Trade where the security offered by the independent producer is insufficient. It opens another avenue of


finance by specifying that the Corporation can finance the independent producer if he puts up 25 per cent. of the total expenditure, or, if the President prefers it, let us reduce the figure to 15 per cent. That is a positive approach.

5.0 p.m.

Mr. Wilson: All that the proviso in the right hon. Gentleman's Amendment would do would be to say that the Corporation could itself do what, by and large, the banks are already doing. I agree with him in what he has said that it is only one more method of finance. We have finance through the distribution companies, finance through the banks, and through this method. I do not think this has added anything to the Bill except the right of the Corporation to take over those methods of financing which in the banks already exist.

Mr. Blackburn: With regard to the words:
except in such classes of case as the Board of Trade may approve …
what method will the Board of Trade take to approve them?

Mr. Wilson: I was coming to that point. I do not feel that we should write into the Act some formula which cannot be changed over a period of years and which might prove to give either too much or too little latitude to the Corporation. I can tell the Committee that it is my intention, as soon as the necessary experience has been gained, to allow the Corporation to lend money direct to producers in all classes of case, if I can use that phrase, which are suitably defined and I should regard it as my duty to state the classes of case we were proposing to approve. But I would not like to tie myself down at the moment to exactly what they are to be. They would include such cases as where the producer is able to point to a satisfactory record of production—I think that is the best guarantee anyone could have.
I do not think we could take the chance of finding out whether the new producer was going to be a good one, at least not with State money. The producer should also satisfy the Corporation that the risk was going to be spread over a programme of pictures which would obviously give a better guarantee than if there was an individual picture. Also this would be

appropriate where the producer can also get either some finance—and this is the right hon. Gentleman's point—or some guarantee of completion by private backers or renters. Having given that assurance, I hope that I have explained what is meant by "classes of case."
I would tell the Committee that it is our intention to use this Clause, as soon as we have the experience and the organisation has been properly appointed, to see that production is financed directly.

Mr. W. Shepherd: I think my right hon. Friend the Member for Aldershot (Mr. Lyttelton) was too kind to the President of the Board of Trade when he moved this Amendment. My own view is that it was never the intention of the Board to use this Clause in any Measure. I think that the whole intention of the Bill has been to utilise the distributor as a means of the Corporation, and, in turn, the Government, avoiding their responsibilities. I think that they thought that by using the distributors' organisation they could say, "We shall avoid making decisions which may be wrong." It was only the Second Reading Debate last week which really forced the President to realise that hon. Members of this House wanted to see something more positive done for independent producers and free lance producers.
I cannot see what is the point of the President talking about this being what the banks did. It is precisely because the banks are not now doing it that we have this Bill. What alternative suggestion has he to put before the Committee? Is it not reasonable to expect independent producers to put down 25 per cent.? With the right kind of equipment, script, staff and reputation they would put down 25 per cent. Unless we can get something more concrete from the President today, I am afraid that this Bill will slip away from this place without any definite provision being made for the free lance and independent producer. Unless we can get something definite the whole effect that this Bill ought to have upon them will be negatived. I hope that if the President comes before us later, this provision will be made quite clear.

Mr. H. Wilson: The hon. Gentleman accused his right hon. Friend of being too kind to me in the way in which he


moved this Amendment, and suggested that I had no intention of operating except through the distributors. I think I can tell the hon. Gentleman—it is not often that he has these sinister and unworthy suspicions—that in this particular case he is completely wrong, and I can provide a considerable amount of proof. I met members of the interim company some weeks ago, before the Bill was introduced, to discuss the matter with them. I told them that I thought it was important that they should be working out a method of financing direct production and that I was sure that the House, on Second Reading, would want to know how we intended to do it. Therefore, the assurance on this point was not dragged out of a reluctant Minister on Second Reading. I knew in advance that the House would want the assurance, and I had every intention of giving it.
Before the Second Reading I did ask the chairman of the interim company to come and see me, and I suggested to him that it would be a useful thing if he could set up a sub-committee to start working out the methods under which financial aid might be given direct to production. He has, in fact, set up a subcommittee of the Board to work it out.
I cannot follow the hon. Gentleman in his reference to the banks. He said it is because the banks are not providing this percentage, and not doing the job, that we have this Bill. I would put it to him that the reason why we need this Bill is because many producers, independent and otherwise, but generally independent, however we define it, were unable to get the 25 per cent. I do not think it is right to say that the banks have been failing in their function. They have been a little sticky now and again this year, for obvious reasons, but I am confident that the banks are going on doing their job. It would not be right to set up a Corporation to take over some or other of their functions, and it is because the independent producers could not get the 25 per cent. that this scheme was announced and this Bill was introduced.
I think it is important that that point should be realised and I hope, therefore, that the right hon. Gentleman will agree to withdraw his Amendment. I assure him that if I could have found any satisfactory way to express the point in some positive way I would have done that. Perhaps I can satisfy him by saying that

the only way that could be done would have been by a very clumsy form of words.

Mr. Lyttelton: I am happy, of course, to accept the assurances of the President of the Board of Trade particularly as I understood him to say that he would come to the House and explain the criteria upon which he was going to judge those classes of case which are contained in the proviso. I agree that the Amendment is largely exploratory, and in view of what the President has said, I beg to ask leave to withdraw it.

Amendment, by leave, withdrawn.

Mr. Lyttelton: I beg to move, in page 2, line 35, at the end, to insert:
(4) The Corporation shall not make a loan to any person in respect of the production or distribution of any film the cost of which exceeds such amount as in the opinion of the Corporation is recoverable by exhibiting the same in the United Kingdom.
This Amendment is designed to prevent very large sums of money being advanced when there is no chance whatever of those sums being recovered. I agree with many hon. Members who have said that there are films which perhaps ought to be financed outside the commercial basis altogether. But here we are dealing with a commercial subject and what I rather recoil from is a film like "Bonnie Prince Charlie" getting £1 million of public money when, in fact, only 40 per cent. of that, at the very best, is ever likely to come back again. The object of this Amendment is to try to prevent advances against one or two films when in fact the commercial basis on which the production is put out is a "goner," if I may use a vulgarism, before it starts. I cannot imagine that this Amendment would be too restrictive. If it were, it would only be restrictive on that type of film finance which we do not want to see. The object of the Amendment is extremely clear, and I do not propose to say anything more about it.

Mr. H. Wilson: Once again, I have every sympathy with the object behind this Amendment, but once again I ask the right hon. Gentleman to agree not to press it. I made a few remarks on this point during the Second Reading Debate. I have not my exact words in front of me, but I think I said that the industry would be gambling on the


prospect of receipts from overseas showings if it were to produce on the average a number of films whose average cost exceeded what it could hope to get in the home market. I stand by what I said. The reason why I ask the Committee not to accept this Amendment is that although I said that it would be gambling to count on big overseas incomes, it would be defeatist for us to assume now, for a period of five years ahead, that we shall not get any overseas income. I agree that at present there are many difficulties about getting income from the United States. I have said that our hopes that the American industry was going to help in pushing our films for us have so far been very greatly disappointed. But I certainly hope, as I think we all hope, that there will be an improvement in relations there. I hope that we shall see a number of our films earning considerable dollars, directly or indirectly, by overseas showing. Certainly, it is a fact that only recently one of the films produced by the group which was also responsible for the production of the epic referred to by the right hon. Gentleman has been very much welcomed in the United States. I am not referring to "Bonnie Prince Charlie," but to another film made by the same company. There is every reason to suppose that it will earn considerable sums of money in the United States. Therefore, it would be defeatist to tie ourselves down for five years ahead to such a course as is proposed in this Amendment.
My second reason is one on which my hon. Friend the Member for West Nottingham (Mr. O'Brien) had something to say on Second Reading. I have not his exact words, but he said something to the effect that he thought it would be wrong for us to tie ourselves down to pictures of a standard quality, standard cost and standard size, and that what we have to produce is a representative series of films, some of them more costly and some less costly. He said that it was no good trying to produce "quickies" or films of a standard type. I entirely agree with what he said. Also I entirely agree with what is behind the right hon. Gentleman's Amendment in that, taken on the average, over a number of films in a particular finance scheme, the cost of those films ought not to exceed what we can legitimately expect to get back from the home market.
On the other hand, I do not like the idea of each individual film being tied down. It may be that money is to be lent to a production company which may have a programme of pictures, some of which may have a great hope of overseas showing and upon which we could not hope to recoup their cost from the home market. But as long as the programme as a whole seemed to be a commercially practical proposition, I think that it would be right that the Corporation should lend money for it. I hope that we shall not tie down the Corporation too closely in this way.

5.15 p.m.

Mr. W. Shepherd: I am extremely disappointed with the argument put forward by the right hon. Gentleman. I do not think that there is any purpose in this Corporation financing would-be epics. It may be that there are epics produced which will earn great revenue in the United States and I am convinced that we shall continue to produce films of that quality. But surely it is no part of the purpose of this organisation to finance such films. We are concerned to bring down the costs of British film production. If the costs of British film production are not brought down the industry will be knocked out. This is a question of survival. No Wilsonian exhortations will cut down the costs of production in British film studios. A producer will spend as much money as he needs to spend. The only way to cut costs is to give the producer less to spend than he has now. This organisation ought to be an instrument by which costs in the industry are forced down. My hon. Friends and myself are concerned, as the industry is concerned, about the action of this Corporation so far. They have put £1 million into the hands of people who, on almost their last six films, have spent twice as much as the films will ever recover in the markets of this country. That is most disquieting. There may be some justification, but I cannot see it.
Surely, what we must do is to use this Film Finance Corporation as a means of forcing down high costs. How else are we to do that? Is the producer who at present asks for £20,000 to produce a film, likely to volunteer to reduce his salary? Are the film stars, who look upon prestige salaries of £20,000 or £30,000 as essential for their work, likely to volunteer to reduce their salaries? Are the unions


who indulge in the most vicious practices in the industry expected to do something? I do not refer to the union with which the hon. Member for West Nottingham (Mr. O'Brien) is connected. He behaves quite well on the average, although I have heard some most unfavourable comments about him recently from exhibitors. He is not responsible for the bad practices which exist in full measure in our studios at present. Neither would it cause producers and those responsible for production to get proper preparation of their films before they can put them on to a stage.
Therefore, it is wrong of the President of the Board of Trade to say, "We will see how it works out. We will let one film balance against the other." The thought that we may make a big profit on "B" but we may make a loss on "A" is the reason for the high costs which now prevail in the industry. Everyone expects that the next film they make will put them "soft" for the rest of their lives. Sometimes, of course, it does, but many times it does not. Surely, we ought to tie down every producer producing under this Corporation to a limit which may be recovered by sales in the home market. It is useless to say that one will be evened out with the other. Moreover, we must tie them down to the budget which they put up in the first place.
The problem of keeping down costs is absolutely vital to the survival of this industry. It cannot be done merely by the President of the Board of Trade saying that he will establish a working party or that it is hoped the producers will do well on one film to make up for what they have lost on another. Here is an instrument, the first that industry has had, to make certain that costs can be kept down, and here is the right hon. Gentleman throwing away this vital opportunity. I am immensely disappointed with what he said. Unless we can get these costs down to reasonable limits, this industry is finished and a great enterprise which could develop most advantageously for this country in the markets of the world will be lost. I remind the Committee that this industry is very near to being lost. It is touch and go at present. Therefore, I express once more my keen disappointment that the President of the Board of Trade has not taken the steps which I believe are vitally necessary for

the survival of what might be a very great industry for this country.

Mr. O'Brien: I had not intended to take part in the Debate at this stage until I heard the speech of the hon. Member for Bucklow (Mr. W. Shepherd). I think the Committee will make a great mistake if they try to impose on producers of films the same sort of method as one associates with a tailor who makes a suit from a certain amount of cloth. If a tailor is given a length of cloth he can make a suit. I am speaking metaphorically, of course. However, if we say to a producer, "Here is a sum of money you cannot go beyond that amount," the effect will be entirely opposite to the intention.
For example, in budgeting for a picture, it is quite possible, without any question of extravagance or high costs of production, for things to happen in the course of production which make it necessary to find more money. If that extra money is not found, the film is likely to be a "flop." There are two extremes to be avoided—and I agree with much of what was said by the right hon. Member for Aldershot (Mr. Lyttelton) on this Amendment. The first is the encouragement of extravagance and unnecessary cost of production, which matter is under examination, and the second is the too rigid control of the producer. That will have a very bad effect.
I, for one, feel that the Amendment is not necessary, although I understand and sympathise with the idea behind it. There is one point which the Amendment has omitted. It refers to sums recoverable from the United Kingdom. That again will "put the screw" on producers even if the Amendment is adopted, because revenues come from the Dominions and the Commonwealth—from Canada, India, Australia, South Africa and Europe, from the soft as well as the hard currency areas. The revenues from these places, to a certain extent, help not only to make a profit but to return the costs of production. I feel, therefore, that the Committee would be wise to avoid the temptation to adopt this Amendment, in view of my remarks and in view also of the possibility of unnecessarily hamstringing a very competent producer.

Mr. Lyttelton: I do not know if it would help the Committee, but I under


stood from the remarks of the President of the Board of Trade that he would be more sympathetic towards this Amendment if it read—
in respect of the production or distribution of any group of films.
If he would consider that form of words between now and the Report stage, I would willingly withdraw my Amendment. I think that was the tenor of his remarks.

Mr. H. Wilson: I should like to think about it. I sympathise with the idea; certainly it should not be tied to an individual film. If it is to be tied, I think it should be tied to a programme of films. But even that wording would not express the way in which we hope the Corporation will work. The Corporation, acting as it is, as a trustee for public money, will undoubtedly have very close control over any money which is lent either to a distribution company or a production company, especially the latter. Therefore, it will have to devise methods of control to ensure that the total expenditure is not likely to exceed the prospective revenue. I feel that it would be wrong to tie it down even to a group of films. In view of its duty to recover these sums, it will have to be very careful about that sort of thing.
We also have to look at the possibility of an expanding overseas revenue, and it would be wrong if it were too closely tied. I am sure the Corporation will have very much in mind all the points which have been raised by the right hon. Member for Aldershot (Mr. Lyttelton) and by the hon. Member for Bucklow (Mr. W. Shepherd) on the question of production costs. I still think it would be wrong to tie down the Corporation, even if we were to spread the loan over a programme of films.

Mr. Granville: I think it will be very difficult to put this Amendment in the Bill and tie down the Corporation, but I do not agree with the hon. Member for West Nottingham (Mr. O'Brien) that there is a great revenue to be obtained from overseas at present.

Mr. O'Brien: In five years, the time envisaged in the Bill, a great deal can come from overseas.

Mr. Granville: Yes, it can come, but I am dealing with the situation in the

industry as it exists today. It is a tragic fact that one of the great difficulties in financing film production in this country is that the market which really matters is the dollar market in Canada and the United States of America. The hon. Member for East Islington (Mr. E. Fletcher), who rendered such a great service to the House on Second Reading by coming forward courageously and giving us all the figures in his professional capacity, showed quite clearly that the experience has been—he gave as an example the film "My Brother Jonathan"—that without an important English-speaking market such as the American market, every penny spent on a film over £150,000, which is about the figure likely to be obtained from the home market, will be a loss.
The fact is that unless we have the American market as our main overseas export market, we must restrict ourselves to what we can get back from the English market. That is one of our difficulties. In Hollywood, films are produced for a country with a population of 140 million; therefore, American producers can obviouly spend very much more money on the production of films for their home market. If a film is made for exhibition in this country, it is only possible to get back the money which is spent on it from a population of about 50 million. Therefore, when the film goes to the United States in order to get some revenue and make a profit, we are up against this comparison, which has existed for a long time.
Although it may not be possible to insert in the Bill the form of words proposed, the President of the Board of Trade has indicated that it will be borne in mind. I hope he will give us an assurance that this £5 million will not be used for another dollar gamble in the United States, because, as he knows, a great deal of dollar currency has been made available for a dollar gamble to capture the American market, and this effort has almost completely failed. Therefore, I should like to have his assurance that this money will not go into the making of epics and grandiose efforts to capture the prestige section of the American market in the hope that we shall get our revenue from there.

Mr. O'Brien: Five million pounds?

Mr. Granville: I do not want any part of the £5 million to be spent on producing pictures which will be shown on Broadway for prestige purposes in the hope of getting second-and third-rate bookings in the United States. This country has never been given a fair deal in the American market. Let us concentrate upon giving this money to the producers who, in the main, will satisfy the home market first.

5.30 p.m.

Mr. H. Wilson: I assure the hon. Gentleman that I agree with him. I do not think this money ought to be used for the production of epics, except in so far as the production of epics can be expected to yield a reasonable return, either directly or indirectly on that film or by affecting the revenues of others. I should not want to put an Amendment into the Bill to say that epics cannot be financed, because we should then have some difficulty in defining an epic.
I have been thinking further about the point made by the right hon. Gentleman the Member for Aldershot. There are the difficulties I have mentioned, but I should be prepared to take this away and think about it again. If, as I hope, the Committee will accept my advice that a further Amendment to be debated shortly should not be accepted, it will certainly mean re-committal to get these things done. I do not know whether the right hon. Gentleman will be satisfied with what I am going to say—perhaps, he will want to divide—but I have every sympathy for the general point which he has made, although I should not like to tie the proposal to the exact anticipated home market revenue. I think that whatever phrase we can work out and introduce after today should be related to the prospective revenue of the film in a way which would allow the Corporation to take account of the prospective overseas revenue. Some of these films may have a small overseas revenue, and, in the next five years, it might develop considerably.

Mr. Granville: Will the right hon. Gentleman give us an assurance that the advisers who will advise whether the very expensively-produced films have any chance in America, will not be the same advisers whose advice to the industry in the past few years has been so calamitous to the industry?

Mr. Wilson: I do not know to what advisers the hon. Gentleman is referring. I think that a very gallant attempt has been made to establish British films in the United States in various ways. Various organisations have tried it by different methods and by financing. The Rank organisation has done it in one way and the independent producers in other ways, but I am not prepared to argue on the film companies' balance sheets this afternoon. I shall be prepared to discuss the working of the Corporation in this House after it has been established, and, if the right hon. Gentleman will accept my assurance, I shall look at this again with a view to introducing, on re-committal, a Clause under which the Corporation will not be obliged to make loans except when it expects the revenue of the film or group of films, taking into account any reasonable overseas revenues, to cover the cost. If the right hon. Gentleman will accept that assurance, I shall give an undertaking to try to have some words ready for introduction, and, in any case, if there is any difficulty about it, he can discuss it with me and perhaps we can reach agreement.

Mr. Lyttelton: So far as I am concerned, I am quite satisfied with what the President has said. He says that he is sympathetic to the general idea, and I do not wish to bind him in any way as to the exact method by which he will do it. I am content that he wishes to try to express our intentions. I regard the principle as one into which it is worth while taking some trouble to inquire. I have been accused by my hon. Friend behind me of being too kind. I will accept that rap, and say that, if on this occasion I am too reasonable, it is only in accordance with my general character. I will accept the President's assurance.

Mr. E. Fletcher: Before we part with the Amendment, it is very desirable in the public interest that we should ask the President to clarify the relationship which is to exist between the Corporation and either the distributing or production companies to whom money will be lent. A moment ago, the President said it is quite obvious that the Corporation would have to exercise a pretty tight control when loans were made to distributors or producers, and particularly to the latter. The particular objective is to make loans to


distributors in respect of special classes of cases which the President will define. He will tell us the categories in which the exception will apply.
The discussion on the Amendment has suggested that the Corporation will be able to influence, if not dictate, the films which will be made by the producers, who, in turn, will receive money from the distributors, to whom the Corporation will make advances of public money. I think it is important that the public should understand the precise functions of the Corporation, so that they will know what is their sphere of responsibility. As the Bill stands, and as I understand it, the duty of the Corporation will be to lend money to the distributing companies, presumably on the security of their general assets, and these companies will be encouraged to make, or to take part in the financing of, a film or a variety of films.
I want to ask the President whether it is contemplated that, when this public Corporation advances a sum of money to a distributor, conditions will be attached by the Corporation as to the particular film or group of films in respect of which this public money is to be spent? There is nothing in the Bill to indicate any such thing. If one reads the Bill, it is perfectly open to reach the conclusion that the Corporation can pick upon a distributor, say British Lion, and say to them, "You are good distributors and you have got judgment, so we will advance you money." If it is intended that the Corporation should go further and say, "We will only advance money to such-and-such distributors to enable them in turn to advance money to a particular producer to enable him to make a particular film or group of films," I think we should know, because it would involve a degree of responsibility which the National Film Finance Corporation will be called upon to discharge, and it will also affect the kind of question for which they will be responsible in this House.
If this is the intention—that they are not merely to select a distributing organisation to be the recipients of public money, but are also to exercise control over the particular film or series of films to be made with public money, and perhaps also control over the cost of production of those films—we are entitled

to know. I raise the point on this Amendment, because, with great respect to the right hon. Member for Aldershot and the hon. Member for Bucklow (Mr. W. Shepherd), their Amendment, as expressed in its present terms, would not give effect to what I understand to be their objective.
If my right hon. Friend will reconsider the matter before Report stage, I think he ought to consider much more than a mere extension of the language of this Amendment. Let us assume that the Amendment, in its present terms, or with the substitution of "a programme of films" for "any film," were accepted, what would the result be? I do not think it would achieve the object at all. It would merely say that the Corporation shall not make loans to any person in respect of the production or distribution of any film,
the cost of which exceeds such amount as in the opinion of the Corporation is recoverable by exhibiting the same in the United Kingdom.
It would impose an injunction of a particular kind against a particular loan, but it would not in any way prevent a loan under Clause 1 (1, b) to persons who, in the judgment of the Corporation, have reasonable expectations of being able to arrange for production on a commercial or satisfactory basis. These are the operative words in this Bill as it stands. If this Amendment were passed, the position would still be that, under Clause 1 (1, b), this National Film Finance Corporation could make a loan of £1 million or £2 million to a particular distributing organisation because it was thought to be the kind of concern which would reallocate the money on a commercially sound basis. If my right hon. Friend is going to reconsider this matter between now and the Report stage, I ask him to do so in the light of the observations I have put before the Committee.

Mr. Wyatt: I was a little alarmed when I heard my right hon. Friend the President of the Board of Trade say that he was going to re-phrase the passages which might be covered by this Amendment. I was alarmed because, when I first saw the Amendment, I thought it was just the sort we ought to have in the Bill, that it was absolutely on the right lines, and that it would help to curb the excessive cost of films today. I was for supporting it, but, as the argument


developed, it became clear that, once such a provision was put into the Bill, it would prevent the making of such films as "Hamlet" and "Henry V" which, of course, cannot recover their costs in this country. In fact, both those films have been very substantial dollar earners in the United States.

Mr. Lyttelton: I think the point is a very valid one. My reason for wishing to limit it to the United Kingdom was because I thought that further risks ought to be carried by the producer in that case, that that was the most hazardous part of the receipts, so to speak, and that it ought to be on his shoulders if the loan which he received were only extended up to the amount of the potential receipts in this country.

Mr. Wyatt: I quite appreciate what the right hon. Gentleman says, but, with great respect, I do not think that is what the Amendment says. It says:
The Corporation shall not make a loan to any person in respect of the production or the distribution of any film the cost of which exceeds such amount.….
I think it would be a most dangerous precedent, even though the right hon. Gentleman's further suggestion that any extra amount should be borne by the producer himself might not be possible of fulfilment. It might prevent a worthy producer from making such a film because he could not raise the extra £100, or whatever it might be, over and above the prospective British revenue. I hope that my right hon. Friend will not re-phrase the Clause in such a way as he just mentioned. I think that my hon. Friend's point as to the exact relationship between the Finance Corporation and a distributor who is going to finance the film, and between the Finance Corporation and the producer direct, requires more clarification, although I suppose it will come out when we discuss the Question "That the Clause stand part of the Bill."

Mr. Gallacher: I have never had any association with, and have very little knowledge of, film production, but the more I listen to hon. Members opposite, the more convinced I am that they know only as much as or even less, than I do. I want to see costs brought down in the interest of the patrons of the cinema. I want to see good British films produced

under conditions that will allow of their being shown. An Amendment of this sort shows a great lack of knowledge of the film business. When the right hon. Gentleman was speaking, he mentioned the film "Bonnie Prince Charlie."

Mr. Lyttelton: Nothing personal was intended.

5.45 p.m.

Mr. Gallacher: I understand it was a heavy cost. I went to see the film, and I enjoyed it. How could anyone consider the production of a film like "Bonnie Prince Charlie" without taking into account the great Scottish populations in Canada, Australia and New Zealand? An Amendment of this kind shows an incapacity to understand the conditions which govern film production today I hope that the President of the Board of Trade will make certain that when assistance is given to the production of films, it will always be recognised that the important thing is that the film should he shown.

Mr. H. Wilson: Like the hon. Member for West Fife (Mr. Gallacher), I, too, thought that "Bonnie Prince Charlie" was a very good film. However, I do not want to go further into that question now. I want, first of all, to reassure my hon. Friend the Member for Aston (Mr. Wyatt) as to what I was going to do on reconsideration of this Clause. Perhaps he did not hear what I said; I think I dropped my voice round about that point. I said that, in taking into account the probable revenue, the Corporation should not merely consider the domestic revenue, but what might reasonably be expected from overseas.
My hon. Friend the Member for East Islington (Mr. E. Fletcher) raised a very important question about the relationship of the Corporation to the distribution companies whom they might finance. I think that the question he asked is one which I ought to answer now. He quoted me as saying that they would have to have a tight control over distribution costs, and an even tighter control over production costs. He asked whether this meant that the Corporation would have control over the films which would be made with the money advanced. Of course, the answer to that is "No," if it means that the Corporation is to have the last word as to whether a particular


film should or should not be made with money advanced to the distribution company by the Corporation. I do not think the Corporation would wish to have any control over the exact projects and scripts of the producers who would be financed by the distribution company, but I am sure the Corporation ought to have some control over the conditions under which money is to be lent to producers by the distribution companies without being called upon to pronounce upon individual films or individual castings, scripts, and so on.
For instance, I think it is quite right—and this, perhaps, is where I am answering the point raised by the hon. Member for Bucklow (Mr. Shepherd)—that the Corporation should, on lending money to a distribution company, sign a treaty with that company making quite certain that the money will be used for independent production, and not for meeting past commitments, and things of that kind. That is the sort of reasonable thing that it might wish to insist upon. Secondly, I think it will probably want to satisfy itself that the distributor is going to use this money for financing production only in cases over which the distributor is going to have pretty tight control through the examination of the budgets of individual films, and pretty tight control over the production of individual producers.
I think the Corporation is right to insist that the producer shall have generally a tight control of that kind, but that does not mean, of course, that the Corporation is going to see to each individual project itself in these cases. It may also wish to lay down certain conditions under which money will be made available. It might want to lay down some method of payment of producers and directors; it might want to introduce a system of payment by result rather than give them a fee in advance. There are many things of that kind which it might like to lay down, and which, I presume, will be in the contract entered into with the distribution company.
The answer to my hon. Friend's question, therefore, is somewhere in between the two extremes he mentioned. It certainly would not be satisfied by saying simply, "You are a good distribu-

tion company and, therefore, we will give you the money and a free hand." On the other hand, it would not go to the extreme length of saying, "We give this money to you as a distribution company and we shall want to see a full account of how every halfpenny of it is spent and to give full approval to every individual script and project." The answer will be in between the two extremes. It will lay down the conditions under which the distribution company will finance production.

Mr. Granville: The President of the Board of Trade says that production will be in the hands of the distributors. Does that mean that the distribution company will also have the say as to whether £200,000, £300,000, or £400,000 shall be spent on the production of a film, in view of its knowledge of what is likely to be recouped from the export market?

Mr. Wilson: Subject to whatever control is put on the distributor, in respect of individual films, by the Corporation when the money is advanced.

Mr. E. Fletcher: The President of the Board of Trade has made an important statement. He said he presumed certain steps will be taken. May I remind him that £1 million of public money has already been advanced to a distributor. It is public money. As I understand it, money has already been advanced to the tune of £1 million by a company formed in pursuance of the announcement made in this House in July last and, in fact, without any statutory authority at all. If the object of this Bill is to sanction that payment which has already been made and to sanction future payments, then one of the objects of this Bill is, in effect, to ratify retrospectively steps which have already been taken by the Government with public money.
The President of the Board of Trade has said he presumed that when further advances are made by this Corporation it will lay down such and such conditions in order to ensure either that certain films are made or that films of a certain class are made; also to ensure that production costs are adequately controlled, and perhaps to ensure that no excessive or extravagant payments are made to any individual. All of those, I think, are very desirable things, but I feel that the President of the Board of Trade ought to go


further than that, and, in view of the fact that £1 million of public money has already been advanced, that we should know what kind of conditions have been attached to the advance which has already been made. We should know whether the President of the Board of Trade will himself lay down the kind of conditions or whether those conditions will be purely in the discretion of the Corporation.

Major Gates: From what the President of the Board of Trade has said, it does not appear that the Corporation will have sufficient control over the money which the Treasury will be lending for this purpose. The whole of the discussion on this Amendment seems to boil down to one point: are these loans to be used for the making of prestige films? My hon. Friend the Member for Bucklow (Mr. Shepherd) used the words "epic films," but I prefer "prestige films" because we all know what is meant by that phrase. If so, whose prestige?
I have the impression, on the whole, that the money is not to be used for the production of prestige films. If that is the case, the market for which they are to he made is fairly well known. It is, presumably, the home market. If they are not to be large-scale, epic, prestige films, the President really cannot have much valid objection to accepting some sort of limitation such as that suggested in the Amendment so that the loan shall apply only to the United Kingdom. In any case, if the film is successful the overseas showing can very properly be profitable. I do not think the President has given a valid assurance which will be sufficient to satisfy the taxpayers of this country that their money will be properly controlled when it is advanced for this purpose. I do not think his assurances are satisfactory.

Mr. W. Shepherd: My right hon. Friend the Member for Aldershot (Mr. Lyttelton) has already indicated that we wish to withdraw this Amendment, subject to impressing upon the President that we hold the principle which is contained in the Amendment to be of the utmost importance not only to the preservation of public money, but to the ultimate survival of the industry. On this occasion there is no difference between my right hon. Friend the Member for Aldershot

and myself. Therefore, I beg to ask leave to withdraw the Amendment.

The Deputy-Chairman (Mr. Bowles): The hon. Member cannot withdraw it. Only the Mover of an Amendment can withdraw it.

Amendment negatived.

Mr. Levy: I beg to move, in page 2, line 38, at the end, to add:

"(5) The Corporation shall not make a loan to any distribution company whose charges for distributing the film or films for whose production the loan is made exceed twelve and a half per cent.
(6) The Corporation shall make no loans without the right to examine and amend the budgeted costs of production and without being satisfied that all reasonable economies are made.
(7) For the purpose of fulfilling Subsections (5) and (6) of this Section the Corporation shall appoint an officer equipped with the necessary experience and ability unless one or more members of the Corporation are so equipped."

The purpose of this Amendment, as the right hon. Gentleman the Member for Aldershot (Mr. Lyttelton) has said, is not dissimilar from the purpose of the Amendment which he moved, but the means proposed are dissimilar. The starting point of the Amendment is a very simple proposition. My right hon. Friend the President of the Board of Trade has said that in these days the banks are very sticky about lending money for film-making. I and, I think, my hon. Friends take the view that, in an industry such as the film industry, if an investment is a bad bet for the banks, then it is a bad bet for the taxpayer. Although we want to salvage the industry, and for that purpose it is necessary to advance funds, we are very anxious that funds should not be advanced without most stringent conditions calculated to safeguard public money and, at the same time, to put the industry on its feet.
I do not want to repeat the arguments which I advanced during the Second Reading Debate, but if we are, in fact, to set the industry on its feet and to make investment in it a reasonable prospect, there are only two sources from which economies can be sought. One is by cutting down the exorbitant charges levied by distributors, and for that purpose the new Subsection (5) is put forward. The other possible


economy, of course, is on the production floor. The new Subsection (6) is intended to deal with that.
I do not think it is necessary for me once again to suggest in greater detail how these economies can be effected, but I might try to anticipate one possible reply, which my right hon. Friend the President of the Board of Trade may make. He may say—and this is perfectly true—that the Bill as it stands at present provides the Corporation, through the distribution companies, with the power to effect precisely these economies. But, in the first instance, it is extremely unlikely that that particular economy will be voluntarily undertaken by the distribution companies—namely, that they will voluntarily forgo 50 per cent. of their own normal charges.

Mr. Wyatt: Profits.

6.0 p.m.

Mr. Levy: It is charges we are talking about. Secondly, I am not even convinced that they will insist on the necessary economies from the production companies which the Corporation will authorise them, in effect, to subsidise. It could be argued, of course, theoretically, that they would do this because their own assets are or may be pledged to the Government in the event of a loss, and that obviously they want to protect their own assets. However, I can imagine a case where a distributing company already well on the way to Carey Street might think it worth while to have a final flier with public money. Incidentally, in a curious way the Bill does put them on a kind of cost-plus basis because distributors' percentage is on the gross, and the gross is liable to be bigger—and past figures will bear this out—on an expensive picture than an a cheap one. So we have really a kind of counter-incentive against the very economies, which all of us desire.
I realise also, of course, that this Bill does make provision for direct loans to producers, so the arguments which I have just been elaborating do not come into effect there, but, frankly, I am sceptical about this project for lending money to producers direct—not because I do not want that to happen, I do—but because I do not see how it will work. Before money is lent to an independent producer, private or public money, there has to be assurance that the producer has a

release for the picture he is to make. There cannot be that assurance that there is to be release unless there is contact with the distributing company. So we come back to the same position. There is surely no real difference whether we go to the independent producer and say, "Show us your distribution contract," or we go to the distributor and say, "Show us your production contract." It is as broad as it is long, and we might just as well go to the distributor first—which, I venture to predict, is precisely what is likely to happen.
For all these reasons, I think that these Amendments ought to be carefully considered. It is, of course, competent for my right hon. Friend to say that these matters are, in a way, sub judice; that they are matters that will be considered either by the working party he has set up or by the committee of inquiry into distribution and exhibition. I cannot object to that reply if it comes, though I sincerely hope that my right hon. Friend will give proposals of this kind a very vigorous blessing; as it were, a recommendation to the committee of inquiry. Even so, I should be happier if he would accept the Amendment because the committee of inquiry has not yet even began to sit and it will be some months before it reports, and, therefore, it will be some time before any schemes can be put into operation. What we are dealing with now is a very important interim period, and for that reason I hope my right hon. Friend will be able to say something to satisfy us.

Mr. J. P. W. Mallalieu: I rise to support what my hon. Friend the Member for Eton and Slough (Mr. Levy) has said, not with a view to pressing vigorously the Amendment, but to ventilate a point of view which is important. I think that in actual fact Mere may be difficulty about Subsection (5) at the present time. It might conceivably happen that if the Corporation were limited to dealing with renters only within the limit of 12½ per cent., it might not find any renters at all with whom to deal. I do not know. That point is one which will be brought out in the inquiry which is now to take place into the costs of distribution and exhibition. I hope very much that the costs of the renters will be examined with great care.
Subsections (6) and (7) seem to me to stand on their own feet now, and to contain points of immense importance. Hon. Member after hon. Member has stressed the importance of the Corporation's keeping some sort of control over expenditure when making loans, and it seems to me that that would do no harm at all. It would bind the Corporation not too tightly were Subsection (6) to be accepted by the President. If Subsection (6) is accepted by the President, it follows almost automatically that Subsection (7) must be accepted as well, because if Subsection (6) is to be carried out we shall need the type of man referred to in Subsection (7) on the Corporation itself.

Mr. Blackburn: The difficulty about the Amendment is that, so far as I can see, if it receives the construction put upon it by my two hon. Friends, the whole Bill will be completely nullified, because no money at all will ever be advanced. The whole issue that matters in regard to films is, Who finds the money? This Corporation will not advance money except against security, as laid down in Clause 2. Therefore, what matters is the question, What terms are the independent producers able to get from the distributors? No distributor is going to give a complete guarantee in respect of a film on a charge limited to 12½ per cent. My hon. Friend the Member for East Islington (Mr. E. Fletcher) knows these difficulties very well. I am sure that 12½ per cent. is far too low. I think the minimum average figure must be 15 per cent. Everybody wants to bring costs of distribution down.

Mr. Levy: Distributors do not.

Mr. Blackburn: My hon. Friend says distributors do not, but are the distributors to have a monopoly of the industry? Who are the distributors? The distributors are Rank, A.B.C., and British Lion. So far as Rank and A.B.C. are concerned, this Bill is not an advantage at all. They do not want any money from the Government and they will not ask for any from the Corporation. If the thing fails, it is to their advantage from the commercial point of view. My hon. Friend the Member for East Islington wants the Corporation, but if I may bring my hon. Friend back to a sense of reality in this matter, I would tell him that if he wants to make a film and asks the

distributor for that money, the distributor has himself to get the money from the Corporation by providing security.
The whole secret of film finance turns round the completion guarantee. My hon. Friend knows perfectly well that the banks—and we have heard much about them—used to advance money, but they did not advance it just because they liked the film or the script, but only advanced it against the completion guarantee; which meant that in one form or another the producer had to find the money himself or give security to satisfy the bank. The whole trouble in relation to the film industry relates to the terms upon which the finance itself is available.
I should like to say one word only on the general question of Government money. I entirely agree that costs must be brought down, and, therefore, the proposed new Subsection (6) is one with which I entirely agree. However, I think its provision is already in the Bill, in Clause 2, because the Corporation may require any such security as may be available. Of course, the Corporation must have the right to approve the budget of every film and must examine it very carefully. I would remind the Committee that when dealing with this £5 million, we are only re-allocating the £41 million which the public gets out of this industry through Entertainments Duty. I would prefer to regard this £5 million as a reallocation of money already obtained in the form of tax.
One practical illustration may surprise the House, and particularly the right hon. Member for Aldershot (Mr. Lyttelton), because it occurred while he was a Member of the Government. The Government advanced money in respect of the film "The 49th Parallel," and the Government made 100 per cent. profit on that film. Therefore, while I entirely sympathise and agree with the general remarks made, I say that they bear very little relation to reality, and that the money which in fact has been advanced so far by this Corporation has been advanced on security, and on the same kind of security as the ordinary bank would require.
The real trouble here is the one to which reference has already been made—the question of how can we succeed in getting money to producers which will


make them independent of the distributors? I am afraid there is no answer to that problem, but a great benefit is being conferred on the industry by this Bill because through its medium the British producer will be able to get money from the distributors or the Corporation direct, which otherwise he would not be able to get. The effect of this proposal is to add £5 million to the total of money in circulation for the financing of British films.

Mr. Wyatt: I do not altogether agree with the remarks of the hon. Member for King's Norton (Mr. Blackburn). The hon. Member for East Islington (Mr. E. Fletcher) showed the other day that his own distributing company, which is linked with the Associated British Pictures Corporation, charges 15 per cent. for distribution, because that was the effect of the figures which were given to us. The hon. Member for King's Norton says that they charge more. We must go by the figures given to this House by the hon. Member for East Islington in respect of the particular film, where the charge was 15 per cent. If that could be done without any Government money being associated with the film whatsoever, as in that case, we ought to be able to get nearer to 15 per cent. for distribution in respect of money advanced by the Government.
I think that what the hon. Member for Eton and Slough (Mr. Levy) said was quite true, that the biggest burden on the film industry and film production at the moment is the extent of the distributor's profit and the distributor's charge. The distributor will not voluntarily reduce his own charge, but will try to get the maximum he can out of the unfortunate producer. It is all very well to say that this means that no distributor will advance money to an independent producer, but it may well be that if some provision of this kind is not made no producer will have the courage or daring to ask for a loan from the distributor because he will be charged, say, 25 per cent., which is a quite normal charge at the moment. I do not say that all distributing companies have charged that amount in respect of all films being distributed, but, nevertheless, it is a normal charge, and it must come down. I think it is only reasonable that the Government

should try to insist on some such provision as that.
So far as the proposed Subsection (6) is concerned, this is a most important provision, and some reference should be made to it in the Bill. There is at the moment no specific injunction or requirement on the Corporation to undertake the examination of the budgeted costs, or the estimated budgeted costs of production, of a film, and I think that there should be. We have had in this Debate and on the Second Reading enough evidence given to show that money is not only spent unavoidably buts that large quantities of money are spent quite avoidably, and that expenditure must be reduced to a reasonable level in respect of a particular film. We must see that reasonable economies are made.
One suggestion which I would make to the right hon. Member for Aldershot (Mr. Lyttelton)—and this meets an important part of his point with regard to the producer putting up some money himself and bearing some responsibility—is that whenever money is advanced to an independent producer, neither the producer nor director should get any fee at all, or only a very small fee, until after the film has recovered the cost of production. This would be a constant incentive to the producer and director to cut down costs and to see that they are kept at a very low level. If they were really keen on making films, they would, without producers' fees and directors' fees, make the films at a lower cost than at the moment. That, in a sense, would be requiring them to put something of their own into the film.
6.15 p.m.
I do not think there is sufficient provision at present for the Corporation to ensure that people with the necessary knowledge are at its disposal. I understand the difficulties of the President of the Board of Trade about having people from the film industry sit on the Corporation, because every one in the film industry would say—it being what it is—that anybody having anything to do with the film industry before he went on to the Corporation was there only for the purpose of feathering the nest of the particular person with whom he had previously been connected. It is a difficult job for a body without any expert advice at all to make up its mind on these very complex issues. I hope that the


President of the Board of Trade may find it possible to find someone sufficiently reputable and "above the crowd" in the film industry not to come under such suspicion, and be able to put him on the Corporation.

Mr. E. Fletcher: I want to say a word, if only again to draw the attention of the Committee to what I still regard as being probably the most important matter in the public interest requiring clarification in this Bill. The House and the public should know where the responsibility and accountability is to lie. I think that the proposed Subsection (6) again draws attention to that aspect of the matter, because there the suggestion is that the Corporation should not make a loan without the right to examine and amend the budgeted costs of production.
The Bill authorises the expenditure by the Corporation of public money by way of loan to a distributor who, in turn, will be able to lend it to the producer. I understand that the chief responsibility on the Corporation is to select the distributor and to rely on him to exercise control to see that there is no undue extravagance in the production of a particular film. The Amendment is designed to secure that the Corporation has the direct right to examine and amend the budgeted costs of production and, I take it, to make a direct approach to the producer in order to effect control over the way in which the money is spent. I again ask the President of the Board of Trade to clarify the degree of control which it is intended that the Corporation should have over the ultimate spender of this money, which will be the production company and not the distribution company to whom the money is loaned.

Mr. H. Wilson: As with so many Amendments this afternoon, I must again express my agreement with the object of the Amendment and ask the Committee to agree that it would not be desirable to add the proposed Subsections to the Bill. The hon. Member for Eton and Slough (Mr. Levy), who moved this Amendment, is really trying to cover three points in the three Subsections which he has proposed. Perhaps I might deal with them in turn. The first of them which he proposes in Subsection (5) relates to the charges of distribution companies. I am quite sure the whole Committee will

agree with him that it is desirable to reduce to the lowest possible figures the charges made purely for the wholesaling or retailing of films, in order that as fair as possible a return can accrue to those whose job it is to produce the films. As my hon. Friend knows, some time ago I announced my intention of appointing a Committee to inquire into the whole question of the distribution and exhibition of films. Like him, I regret the delay in giving effect to that undertaking and in seeing the Committee start on this work. However, I am now in a position to announce the names of seven persons who have consented to serve on this Committee, and perhaps it might help to reassure my hon. Friend if I tell him who those seven are, what their terms of reference are to be, and that I expect this Committee to get down to work in the immediate future.
The chairman of the Committee will be Lord Portal of Laverstoke In this connection, perhaps, it might be useful if I were to make a comment on some quite extraordinary remarks which have been made about the Government's attitude to film distribution—and not only in the English Press. I saw recently—only this weekend—in the American Press the suggestion that this Bill has been introduced with some idea of providing a political censorship on the kind of films to be made in this country. Only a few days ago I saw the suggestion that this Bill is the thin end of the wedge, and that very soon any films which do not secure the approval of my right hon. Friends in the Cabinet will not be allowed to be made. I should think the fact that I have invited a Conservative former Minister to preside over this very important Committee would be one of the best possible answers to any suggestion that the Government are proposing to use this Bill or any of its other contacts with the film industry for the purpose of political censorship or in any way affecting political opinion.
In addition to the noble Lord, the members will be: Mr. Barrington-Gain, who I think is well known for his financial knowledge of the industry; Mr. J. H. Lawrie, who is Chairman of the interim Finance Company; Miss Lucy Sutherland; Sir Arnold Plant, who has for many years been a member of the Films Council, and has an almost unrivalled know-


ledge of certain types of film distribution; Sir Ralph Richardson, who is being appointed, of course, because of his very great reputation on the stage and his knowledge of this problem from the actors' point of view; and finally, Mr. William Smart, who is a Scottish trade union leader. I hope that ultimately there will be eight members in all, and it is my intention to appoint someone with a more purely financial or City background.
The terms of reference of this Committee have been settled and are:
To consider, against the background of the general economic situation in the film industry, the arrangements at present in operation for the distribution of films to exhibitors and their exhibition to the public in commercial cinemas, and to make recommendations.
I hope my hon. Friend will agree that those pretty wide terms of reference will mean that this Committee will go into many of the questions covered in his Amendment, especially—if I may use something of a vulgarism—the share-out of the total revenue of the industry among its component parts—to the wholesalers, or renters, and to the retailers or exhibitors. I think it would be wrong, therefore, to prejudge the issue of what is a reasonable percentage.

Mr. Levy: When will the Committee report?

Mr. Wilson: It is very difficult for me to say that, or to enter into any commitment. However, I have the Chairman's assurance that he intends the Committee to get down to work as soon as possible and to produce a report as quickly as is compatible with completing the very big and important job the Committee has to do.

Mr. Levy: Am I right in thinking that the terms of reference which my right hon. Friend has just read out do not exclude necessary investigation of the production end? That is of such great importance.

Mr. Wilson: The production end will, of course, come into it, though the actual work on what we all agree to be so important, namely, the problem of reducing production costs, is being currently undertaken by the Working Party of the Film Production Council.

Mr. J. P. W. Mallalieu: What power will the Committee have to secure information from the trade itself?

Mr. Wilson: It will have the usual powers of any Departmental Committee. I should be extremely surprised if any section of the trade withheld any information required for the purposes of the Committee. In fact, if the Government felt that information was being unreasonably withheld, then we in the Board of Trade possess all the powers required for getting any information relevant to the work of this Committee. I should be very surprised if it were necessary to use any of those powers.
Turning to the proposed Subsection (6), I agree with what is intended, but I do not think it necessary to tie down the Corporation to operate in this way. Obviously, the Corporation, consisting as it will of members chosen for their business experience, will insist on scrutinising the budgets submitted to it wherever it is financing production directly, and will insist as far as possible on the elimination of extravagance. If we were to say that the Corporation shall not make loans except in cases where it behaves in this way, we might tie its hand, and in certain circumstances it might be prevented from making the loans which we all consider it desirable to make.
There is a difference, I think, in the degree of its control as between those loans which go through distribution companies, who may be presumed to have their own organisation and methods for vetting budgets and keeping control over costs, and those loans which go direct to production. As I said on Second Reading, it will certainly be necessary for the Corporation—and I agree with the purpose of the Amendment in this connection—when it does make loans direct for production, to set up the kind of organisation needed to check expenditure, to vet budgets, and so on. However, I do not think it is necessary to put that into the Bill.
I do not think it is necessary or right to accept the proposed Subsection (7), which implies that the Corporation could not be trusted to take sensible precautions unless it were tied hand and foot by explicit provisions. I am quite certain that the Corporation to be appointed will be very fully alive to the


need, not only for protecting the tax. payer but also for ensuring that money is wisely and economically used. I hope, therefore, that my hon. Friend will agree to withdraw his Amendment.

Mr. Levy: In view of the assurance given by my right hon. Friend, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

Remaining Clauses ordered to stand part of the Bill.

Schedule agreed to.

Bill to be reported.

Bill reported, without Amendment; to be read the Third time upon Monday next.

Orders of the Day — JEWELLERY DEVELOPMENT COUNCIL

6.29 p.m.

The President of the Board of Trade (Mr. Harold Wilson): I beg to move,
That the Draft Order, entitled the Jewellery and Silverware Development Council Order, 1948, made by the Board of Trade under Section 1 of the Industrial Organisation and Development Act, 1947, a copy of which Draft Order was presented on 29th November. be approved.
I do not think I need take up the time of the House very long in expounding this order. The Jewellery and Silverware Development Council Order, which is now presented to Parliament for approval in accordance with the requirements of the Industrial Organisation and Development Act, 1947, will be the third order to be made under the Act. Its purpose is to provide for the establishment of a development council for the jewellery and silverware industry, and it follows closely the precedent set by the Furniture Industry Development Council Order, which has just been approved by Parliament.
The establishment of this Council will give effect to the recommendation of the Jewellery and Silverware Working Party, which said:
If as an industry it continues to exercise as little control over its own destiny as in the past, it seems likely to have an extremely unprosperous and precarious future—indeed, in our judgment, it is hardly too much to say that, as an industry of any size or importance, it is doomed.

The working party considered arrangements should be made to ensure that the case of the industry could be continuously and effectively stated to the Government and the public, and that the Government and the public would feel satisfied that every effort was being made to see that the interests of the consumer and of the nation as a whole received proper attention. The Report went on to say that:
This could best be done, in our judgment, through the establishment of a Standing Jewellery and Silverware Advisory Board. which should be tripartite in structure.
I do not need to spend much time in talking about the industry. It is a very old and honoured industry, reputed to have been founded by St. Dunstan in the tenth century. It already had a trade association in 1180, which is quite an early date for a trade association. I think that its general organisation and location are well-known to Members, and that the House will understand the main problems with which it is confronted. It is at present concerned, for instance, with the development of its export trade. The industry never had a very big export trade before the war, but in 1947 it exported, despite many export restrictions abroad £2frac12; million, which is something like three times the pre-war figure. That is a very fine achievement, even taking into account the price increases.
One of the big problems with which all sections of the industry recognise they are faced is the problem of increasing the productive efficiency of the industry especially in certain of the smaller firms. This is one of those industries which consists of a large number of small firms —1,258 firms out of a total of 1,716 employed less than 11 workers in 1935, Although it is true that in many fields of production in the industry the skill of the craftsmen cannot be replaced by machinery, the industry feels that in certain parts the production layout, management and sales methods could be very much improved. The industry is faced with the big problem in certain parts of the country of recruitment, and is conscious of the need to improve working conditions. It has certain raw material problems, and above all it is desirous of improving its present arrangements for design and research. The Design and Research Centre for the gold, silver and jewellery industries was established some


two years ago. It is not intended that the Development Council will duplicate the work of this centre, but will support and assist it, and, in particular, will provide it with an assured income from the industry out of the proceeds of the levy.
We are looking to this development council to make a notable contribution towards the solution of all these difficult problems. I think I can say that, although there is no unanimity, very large sections of the industry welcome the establishment of the development council. The Working Party also urged strongly that a single employers' association should be set up, and a Federal Council was, in fact, constituted for the employers' side, but the Master Silversmiths' Association were a little individualistic on this point. I think it is a little interesting, when trade associations go a little individualistic. I have no objection to a certain robust individualism on the part of individual manufacturers, but when one sees trade associations going all individualistic, it is perhaps worthy of comment. It seems quite likely that the Federal Council will shortly formally be breaking up, as it has already done in practice.
I am under an obligation to refer, as I have done with regard to the previous orders, to the consultations which have taken place before this order was made. In the case of this industry, consultation began with the consideration of the recommendations of the Working Party. The British Jewellers' Association, which has a membership of some 800 firms and is responsible for some 75 per cent. of the output of the industry, and the Society of Goldsmiths, Jewellers and Kindred Trades, with a membership of 1,850, accepted, in principle, the recommendation that a central tripartite body should be set up, and agreed that it should take the form of a development council, constituted under the Industrial Organisation and Development Act. The Master Silversmiths' Association, which has a membership of 78 firms and are responsible for about 12 per cent. of the output of the industry, opposed the establishment of a development council. The National Union of Gold, Silver and Allied Trades neither opposed nor supported the establishment of a development council. The manufacturers'

organisations consulted are broadly representative of the whole of the industry, but I have mentioned that one section was opposed to the establishment of a development council. I am sure, however, that the development council will be welcomed by a substantial number of employers and workers, if not by all.
Therefore, a draft order was drawn up in consultation with these bodies, and a number of other bodies, and in August last this draft order was published so that anyone affected by it, or interested in it, might have an opportunity to comment on its text before the final version was prepared for presentation to this House. A number of comments were received, some from the trade associations and some from individual manufacturers. Most of these comments were of a minor, technical or drafting nature, except for the comments made by the Master Silversmiths' Association. Their comments were principally designed to impose drastic limitations on the scope and the authority of the Council. While we have made a number of minor amendments to meet the more reasonable requests of the Master Silversmiths, most of their suggestions had to be rejected if the council were not to be reduced to an ineffective shadow. I can say, therefore, that the majority of the industry, with the exception of the Master Silversmiths' Association, are in favour of this draft order now before the House.
The principal provisions of the draft order follow the orders already approved by the House. The constitution is set out in Article 2 of the Third Schedule. It lays down that the council shall consist of 12 members. One will represent the employers in each of the four main sections of the industry—fine jewellers, manufacturers of imitation jewellery, goldsmiths and silversmiths, and electroplate manufacturers, and four will represent the interests of the workers. Three will be independent persons, including the chairman, and one will be chosen as having special knowledge of the marketing and distribution of jewellery. The provisions for appointing the staff and the salaries follow the usual orders that have been placed before the House.
As in the Furniture Development Order, provision is made for the maintenance of a register of all persons carry-


ing on business in the industry, in order to make available a comprehensive guide to industry, to facilitate the collection of a levy by the council, and generally be of use to them in the discharge of their functions. These are the only powers given to the council, although there is a fairly lengthy list of the functions printed in the Second Schedule, all of which are permissive and not compulsory, and none of which involves any interference with the operations of individual firms. They are designed to enable the industry to improve its collective arrangements and its centralised arrangements for the benefit of the industry as a whole. That is probably all I need say in expounding this order which, as I pointed out, is largely an agreed order, but not entirely, unlike the other two which were put before the House and which were entirely agreed by all sections of the industry. If I am given the leave of the House to speak again I shall be happy to reply to any points raised in the Debate.

6.41 p.m.

Mr. Oliver Lyttelton: I greet this jewel song from Millbank with very little enthusiasm, indeed, with about as much enthusiasm as the right hon. Gentleman displayed in expounding the order. The main reason for its acceptance by the trade is that they realise they are a luxury trade, that they are entirely dependent on the Government for their supplies of raw materials, and would rather give in quietly than make a fuss. Without wishing to be unduly frivolous I say that is also my position tonight. I am prepared to let this order go by as the trade would rather lie down under pressure from the Government and from the unions than put up an independent fight.

6.42 p.m.

Mr. Erroll: I wish to say a few words about the Development Council. While I think it will not do much harm I very much doubt whether it will do much good. The lack of enthusiasm displayed by the Minister in introducing this order was most marked. I would remind him that development, research and design was taken care of by a research council which was established two years before the proposal was made to establish the development council. I was sorry to hear the right hon. Gentleman take the view that

a trade association was being independent. After all, what is a trade association for except to express the views of their members? If members are independent in spirit and outlook then their trade association should correctly reflect their spirit. I was sorry that an innuendo was cast on a trade association which, choosing to be independent, was said to be naughty or wrong. I hope we shall have an explanation from the right hon. Gentleman. I will give way now if he wishes to intervene.

Mr. H. Wilson: I did not use the word "independent." I said "individualistic." This association, representing a number of very distinguished firms in Sheffield, naturally takes colour from its members. I recognise, as I am sure the hon. Member for Hallam (Mr. Jennings) recognises, that Yorkshiremen are notoriously individualistic; indeed, as a Yorkshire-man myself I am not without some individualism. What I did say was that the failure of this trade association to co-operate with other trade associations in the industry for the common good was something to be regretted.

Mr. Erroll: I hope my hon. Friend the Member for Hallam (Mr. Jennings) will be able to deal with that point later.
I also wish to refer to the suggestion that small firms are perhaps not as efficient as they might be. It should be realised that in the jewellery industry there is a large number of small firms which cater for the highly specialised and individualistic needs of a small semi-luxury clientele. We must not be bemused by the idea that the industry is a large organisation, producing the type of jewellery which we necessarily have to export. We must remember that small firms with only a few employees, who are efficient craftsmen, may produce far better articles than those produced by large organisations which depend on something approaching mass production methods. Apart from that, I have nothing to add, except to point out the difference in the way in which this development council was referred to, as compared to the working parties which were introduced about three years ago.

6.45 p.m.

Mr. Jennings: The Sheffield Silversmiths' Association have a fundamental objection to this order, and are to be admired for standing out for


what they believe to be a matter of fundamental interest to their industry. They object to being classified with the jewellery and ancillary trades. They say they have nothing in common with those trades, except that their products might be sold in the same shops. Their workers are craftsmen, and the Sheffield silver and electroplate industry is known the world over. They are perfectly justified in standing out against the appointment of a development council. When an industry is approached on this question it knows that it might get its supplies of raw materials cut off and, willy-nilly, it is forced to agree to this sort of thing. Undoubtedly pressure is brought to bear on an industry to agree to such things as development councils.
The Sheffield Silversmiths' Association say, "If you intend to force a development council on us will you allow a specific section of it to deal with our industry, instead of allowing the whole council to deal with all ancillary industries?" The Minister must admit that there is a wide difference between ordinary jewellery and the products of a craftsman industry such as that which is carried on in Sheffield. If he does not his order will not do much good. The Sheffield Silversmiths' Association are prepared to pay their levies, and provide such information as the development council requires, but say they cannot take any active part in the work of the council because their industry is quite distinct from the other allied industries which are, covered by this order.
The right hon. Gentleman mentioned the word "individualistic." He knows that the whole trade in Sheffield is individualistic. I believe they are to be admired for standing out for their own trade and their own craftsmanship, which has been built up on years of experience. I feel that the President of the Board of Trade should have admitted that he had been approached with regard to the fundamental issue in the trade. I could quote from minutes where representatives of this section of the trade have been to see the Minister, and have gone back to receive 100 per cent. support from their representatives at the annual meetings, who were standing strong for a special section of this development council to deal specifically with their branch of the industry.
I should specifically ask the President of the Board of Trade—I cannot be definite about this and I hope he will accept it in the way 1 am putting it—if he did not agree with the Sheffield representative of the Silversmiths' Association as to the difference between the types of trade in the industry, and that he would see that in any order that was made there would be a special section covering the Sheffield industry? The industry has been rather misled. I hope the President will accept that in the spirit in which it is meant; I do not mean that they were deliberately misled but that they had been given to understand and agreed to this development council in the belief that there was to be a special part of it, to deal specifically with their industry. Is not that the case?
I can understand their disappointment when they saw this order and noted that it contained nothing at all in regard to their own particular branch. I am asked to protest strongly against it, and I do so. I would, if possible, oppose the order on the ground that the Sheffield industry has not, in my opinion, had fair consideration. When he comes to reply would the right hon. Gentleman definitely say that the Sheffield industry will receive more consideration? The President of the Board of Trade said that there were no major objections but a lot of minor ones to the order. I have criticisms here covering almost every paragraph in the order.

Mr. H. Wilson: Perhaps the hon. Member misunderstood what I said, or maybe 1 was not too clear on the point, but I said there were no major objections except the objections of the Silversmiths' Association. The other comments received were all of a minor character, but those of the Silversmiths' Association were pretty fundamental.

Mr. Jennings: I do not want to delay the House by reading out all these objections. There are two pages of them and they cover almost every paragraph in this order. There is criticism of the council occupying property without the authority of the industry concerned, of the salaries to be paid, of the development council being responsible to the Board of Trade instead of to the particular industry which puts up the money which pays the expenses and so forth. As I say, I will not weary the House


with all the objections, but I must strongly protest against this Motion on behalf of the Association of Silversmiths of Sheffield. I hope the President of the Board of Trade will, in his reply, afford some encouragement to the Sheffield branch of the industry, and that a special section will be set up to deal with it. In this manner they will appreciate that they are being taken care of and given the consideration which they justly deserve, because they are playing a very important part in the export trade.
I would not be allowed to refer to it in detail, but if this industry is encouraged and some further markets are opened up for its export trade, the result may be that more bacon could be purchased abroad for this country. As I say, 1 cannot deal with that in detail, but 1 have had that aspect of the question put to me. If the President of the Board of Trade would consider all these points perhaps he would give more consideration to this industry. Finally, I cannot protest too strongly against this Motion on behalf of this Association.

6.55 p.m.

Sir Peter Bennett: I am sure that every side of the industry will sympathise with the views put forward by my hon. Friend the Member for Hallam (Mr. Jennings), who has laid before the House the point of view of Sheffield. I speak from the Birmingham end, and therefore, I have a certain amount of resentment against my hon. Friend when he keeps on emphasising the craftsmanship of Sheffield, and by inference suggesting that the rest of us have not any craftsmanship at all. I am sure that he did not intend it that way, but I want to make it clear that craftsmanship is not the prerogative of Yorkshire or Sheffield, and that the work turned out in the jewellery quarter of Birmingham is well-known all over the world for its quality of craftsmanship and its beauty of design.
Having said that, I should like to say that had it been possible, I would have favoured the President of the Board of Trade separating Sheffield from the rest of the industry in this matter, because I do not like to have unhappy bedfellows quarrelling. I know it is difficult. There is an overlap, and in order to make

certain that that overlap does not upset matters the whole industry has been put into one compartment. Had it been possible to keep it separate, it would, in my view, strengthen the scheme from this point of view that we have always advised the President of the Board of Trade to get voluntary agreement. Here is a case where there is a large amount of voluntary agreement with a little very strong opposition.
As regards Birmingham, my own works have nothing to do with jewellery, although we have turned out good craftsmanship. However, we are in the middle of the jewellery quarter, and, therefore, I have watched its development during the whole of my business life. It is a peculiar industry. It has grown up from private houses, with little shops built at the back. I know the same thing applies in a good many cases in Sheffield, but, nevertheless, it is a peculiar industry that has not the large factory organisation with which we associate production in the ordinary way. It is a small individual craft. These firms have moved from the houses now and have gone into factories. They have an enormous problem in front of them in rebuilding premises and bringing themselves up to date.
It is not for me to say whether they are wise or not, but it is certain that the jewellery sections to which I refer and which are located in Birmingham as well as in other parts, have agreed amongst themselves to advise the Board of Trade that they are entirely in favour of this council. We Birmingham Members of Parliament naturally support our own people, therefore, this Motion. The reason I do so is because the President of the Board of Trade in this case has obtained voluntary agreement with the exception of our friends from Sheffield. The President knows quite well that when he gets that, we support him, but, on the other hand, many of us are very much opposed to anything which is forced on to an industry and to which they object. I am not referring to the protests from my hon. Friend from Sheffield, but to other organisations which the President will have in mind where the industry offered voluntary co-operation and asked to be allowed to run their own organisation in their own way and not have a development council forced upon them.
I support this Motion. I regret that a way has not been found of making Sheffield happy. We in Birmingham are constantly in competition with Sheffield. At the moment it seems to be a competition between us to keep from the bottom of the League table. I hope we shall both be successful. If the right hon. Gentleman could help Sheffield without upsetting Birmingham, I should be very pleased. I am very pleased to have this opportunity of saying that the President of the Board of Trade in this matter has the wholehearted support of the jewellery trade of the district in which I live, and I have very much pleasure in supporting his efforts in this case.

7.0 p.m.

Mr. William Shepherd: I do not propose to enter the contest between Birmingham and Sheffield. The two contestants have done very well themselves. I would not, at this late hour, have troubled the House with any remarks at all if it had not been for the winding-up by the President of the Board of Trade on a previous order which he moved. I am concerned about the misrepresentation of the purpose of development councils.
It was very evident on the last Debate that we had, on the subject of furniture. One hon. Gentleman thought that the development council ought to finance the introduction of new machinery and ought to establish joint industrial councils. That sort of thing is not good enough from Members of Parliament. If that is the kind of view which is held inside this House, what must be the views held by people outside who have less knowledge of these things than we have who are in the centre? I call attention to these misunderstandings because they are damaging to the prospects of the organisations themselves. If hon. Members constantly assert that these councils should have wide powers outside those which they actually have, they are fostering fears among many people that these councils are the back door to something else. The President of the Board of Trade is having difficulty in getting agreement in many industries. The misrepresentation by his own supporters makes his task much more difficult.
These development councils are an instrument for the self-government of

industry. They have no representatives of the Government upon them at all. They are concerned with self-administration, to do things together better than they have been done separately. They have no powers at all, save those of the levy upon the industry and the production of certain figures. They cannot force anything upon anybody. Everybody who has paid the money, is entitled to disregard what they suggest. There is no power of compulsion at all, save in the directions I have mentioned. They are a genuine effort, which may or may not succeed, to get self-government and self-discipline into industry. Certain industries, such as the one which we are discussing today, are composed of small units, and the development councils will be a very suitable vehicle for them.
If we are to have constant misrepresentation fostering the idea that the powers of the councils may be enlarged to something else, all the good work which has been done by the councils will be destroyed. I hope, therefore, that the President of the Board of Trade will make clear how limited are the functions of these bodies and that it is a question of voluntary acceptance on the part of all who take part in them.

7.4 p.m.

Sir William Darling: I follow my hon. Friend the Member for Bucklow (Mr. Shepherd) in emphasising the importance and the desirability of getting plenty of co-operation for the development councils. The President of the Board of Trade should be well aware that they are not acceptable to a great many individualistic employers, manufacturers and businessmen in the country. If they are to be a proper organisation in industry, they must be put in the most agreeable light. My hon. Friend is in error, I think, in supposing that the Board of Trade imposes no control over the development councils. Indeed, the order which we are now considering makes it clear that the Board of Trade will appoint three members to the development council, and that the Board is to be satisfied that they have no financial or industrial interest——

Mr. W. Shepherd: I did not say that the Board of Trade imposes no statutory requirement upon the development councils. I said that, save for the levy and for the production of certain figures, there


was no statutory requirement placed upon members of development councils by the council itself.

Sir W. Darling: I thank my hon. Friend for clearing up a misunderstanding. I should like to ask the President of the Board of Trade a question which he may consider worth answering. He will notice that the constitution of the development councils contains the usual representation that one would expect, but there is anxiety amongst people who are good craftsmen in jewellery, because of the fact that they are not represented. They may be only small craftsmen or perhaps they are only their own employees. That is why there should be some special effort made to represent them. These people are supreme individualists in this industry and they are not specially provided for in the constitution of development councils.
I have no doubt that paragraph 2 (4) will be the one which will bring them in, and I like to hope that some such arrangement is contemplated, because of the nature of these craftsmen. They cannot give up the time, however, to represent upon these councils even themselves and their own special aspect of the industry. In fact, one of the growing dangers about the development councils is that they tend to take from each industry the loquacious, time-wasting type of person, who tends to use the development council as an opportunity for indulging in talk. The man who is good at his business, but cannot talk with such engaging fluency as that of which the President of the Board of Trade is such a master, tends to remain at the bench or in the office because he has no time to give to the development councils. Those who can talk, those who are engaging in the proliferation of mere words, are encouraged, to the discouragement of those who are doers. I do not see in the constitution of the development councils any particular arrangement which will meet that difficulty.
I have a further objection. This particular case is very properly one of a development council for the United Kingdom. The President of the Board of Trade is often in a quandary on the subject of representation. If he adequately represents upon the development council the main centres, like Birmingham, Sheffield and London, as he properly must, he will inevitably relegate other

centres, who are perhaps not so important, except in their own localities, to practically a condition of non-representation. The goldsmiths, the silversmiths and the makers of artificial jewellery in other parts of the country will have relatively no representation. That will tend to concentrate, narrow and limit these specific industries to the towns and cities in which they at present exist, while the wider distribution of industry which is desirable both functionally and economically, will be prevented.
I have an example in that part of the United Kingdom from which I come. We have recently been engaged in developing an extensive hydro-electric business to give the ordinary small workshop some opportunities for the development of crafts. Under the leadership of a former Secretary of State for Scotland, Mr. Thomas Johnston, many such small industries are coming into existence. Among them is jewellery, which is using our native cairngorm and our native silver and gold, which are sometimes found in small quantities in Scottish localities. Industries of this kind are capable of development. They may be small, but they are highly individualistic, and highly characteristic. What representation does the President of the Board of Trade think he can arrange for such persons, upon this council? I am concerned about the development council, but I am also concerned with the desirability of seeing that it is fully representative.
I pass to paragraph 5 where a very interesting principle is established. It is the principle whereby an ad valorem charge will be levied on those engaged in the industry to pay the expenses of the development council. This is a very interesting departure. Apparently it may be any figure. It may be such a figure as to be crushing to the small man although comparatively easily carried by a larger business enterprise. My imaginary craftswoman in the Highlands making cairngorm jewellery may be crushed by it, while the opulent and prosperous manufacturers in Birmingham and Sheffield may be able to meet it in their stride.
The ad valorem charge is possibly not the best of the methods by which the expenses of the development council can be met. I suggest as an alternative, that certain producers in a small way of


business should be allowed associate membership for a nominal fee of 5s. or 10s. per annum. With people engaged in a total output of not more than £200 or £300 a year, the ad valoremmethod of charging does not seem to be one which would commend itself to me or others who are familiar with that aspect of the business. I am one of those who have always felt that the Purchase Tax referred to in the same paragraph is an unsatisfactory method of raising taxation, and I am glad to see that the Purchase Tax is excluded. I should like to see the ad valoremmethod which it is proposed to extend to the levy extended to Purchase Tax, but it would be out of Order to pursue that matter indefinitely.
I pass with greater security to para. 5 (4, c). I ask the Minister to consider the justification for compelling the small producer of whom I am thinking to produce for the examination of the Council:
such books and other documents and records in his custody or under his control relating to such business.
For a person commencing business or established in a peculiar and special way to submit to large-scale competitors the background and quality of his business is to invite crushing competition. It may be that I have invented or popularised a design for jewellery, and it may be that I have certain exclusive rights in the matter in a limited way, but I am required to produce the records of the design and the success or otherwise of my business to my larger competitors who, under the development council, are in a position to acquire that information. I have no doubt that hon. Gentlemen opposite would be reluctant to take advantage in business of anything they acquired in a public position, but this provision ought to be amended. It is clumsy and might well be onerous and depressing, and I should say that the development council could function quite satisfactorily without it.
In this grim business of the revelation of the secrets of one's business, we pass to paragraph 8 where, in relation to a development council—which is being brought in on the good will of an industry for the improvement of conditions, the betterment of design and the better understanding of the consumer's needs—we find these sledgehammer, punitive powers. Up to £50 is the crushing penalty which is to fall on

the devoted head of someone who is guilty of no greater a crime than that he wants to make and sell something which he hopes the public will buy. That is quite out of accord with the spirit of a development council. Sweet reasonableness is surely the way in which we should approach these matters at this stage. Until His Majesty's Government or their successors have the fuller powers they desire, I have no doubt that they will have to chaffer with those of us who still believe in free enterprise. This is a little too sudden. These penalties should be withdrawn. No man or woman engaged in the business of the production of jewellery will refrain from giving suitable information which it is in the public interest to give. When I see a penalty of £50 and £5 a day for every day after the records are not provided, my gorge rises against it, and as a representative of a nation of shopkeepers, I offer my protest.
My hon. Friend the Member for Hallam (Mr. Jennings) referred to the representation of the silversmiths. Silversmiths and goldsmiths are separated in the Bible. Why should the President of the Board of Trade bring them together in an unholy and unproductive alliance? Surely his wide knowledge and experience in other directions has enabled him to meet this matter. I suggest with all sincerity that there is as much difference between gold and silver as there is between wool and cotton. The right hon. Gentleman does not propose to make a development council for all the textile trades in the country. He admits that cotton and wool are two different things. There is as vital a difference between cotton and wool as there is between gold and silver, and the case of the Master Silversmiths Association is made 100 times over. Let him unloose the bonds. Let us have a development council for the silversmiths and let the goldsmiths rejoice in their going.

7.16 p.m.

Mr. A. Edward Davies: I rise to support the order and to refer to some of the words of the hon. Member for Edgbaston (Sir P. Bennett). He was apprehensive about imposing development councils on industry, and I think that when introducing the Industrial Organisation and Development Act, under which this order


is made, the President of the Board of Trade made it quite clear that the Government would prefer to have the co-operation of the industrialists and all who are interested rather than impose a development council upon an industry. Unfortunately, it is not proving as easy as all that. We know that in the jewellery industry, as in other industries, there are good and bad employers. There is a variety of experience which might be useful to all sections in the industry. It is because the Government recognise that, in competition with other countries, nothing but the best will be good enough if we are to sell our products, that they come to our industrialists and offer, in a co-operative way, to place at their disposal under a system of cooperation the best experience in the industry.

Sir W. Darling: Where?

Mr. Davies: I could multiply the examples. It is well known to all of us who have any knowledge of industry that there are some people who do not observe the rules of the game and that some of the best employers are penalised because of some of the malpractices of the less honourable members of the trade. We would certainly make the point that the best use has not been made of research and that in some of the industries there has been an almost complete absence of a costing system.
The hon. Member for South Edinburgh (Sir W. Darling) referred to what he considered to be improper interference in the affairs of a company in view of the fact that it will be possible to call for certain figures and to inspect the books, but if he had been fair to what is contained in the order and the intentions of the Government he would have agreed that none but a properly designated person will be invested with that power, that there is protection for the industrialist and that it is only under proper conditions that such information will be called for. It is impossible for a scheme of this kind to operate unless we have the willing and practical cooperation of all who are interested.
I would, however, speak more especially from the point of view of the workers, and say that the development council should be similar to development councils for other industries. I suggest

that, if the workers are to be requested to work harder and produce more, if they are to be exhorted day by day, they have a right to have the maximum information at their disposal about an industry, and to have the capacity and opportunity for contributing out of their knowledge and experience to the well-being of the industry. It is well known that this has not been the case in many industries, that workers who have had lifelong experience have felt, both in the policy and aims of the industry, that they had no voice. That is not to say that there should be interference at executive level in terms of decision, which must be the prerogative of management, but that the aims and ideas and the problems which concern the industry, which affect, after all, the well-being of the workmen in the industry, should be jointly considered.
When the hon. Member for Bucklow (Mr. Shepherd) referred to misrepresentation and misunderstanding, I have no doubt he had some grounds for what he was saying. Certainly, there is no desire under a development council, as I understand it, to interfere with the ordinary methods of collective bargaining or to discuss wages. If, however, it is a question of closer co-operation between all sections of the industry, including the working man in the industry, certainly a development council means that. For that reason, I welcome the setting up of this development council today, and I hope that this third development council now being set up in the jewellery industry, following one in the cotton industry and another in the furniture industry, is the forerunner of many other useful organisations of this kind, so that we may have the full advantage of what was intended in the Industrial Organisation and Development Act, 1947.

7.22 p.m.

Mr. H. Wilson: I can reply only by leave of the House but as there have been one or two points raised, I hope I shall have that leave.
It was commented by the right hon. Member for Aldershot (Mr. Lyttelton) and one or two subsequent speakers that apparently I introduced this order with some lack of enthusiasm. If it was so considered, I would only plead in extenuation that I have been sitting on this


Bench for some three and a half hours, together with one or two other hon. Members, dealing with the affairs of the film industry, and we cannot always keep up the enthusiasm and keep at the heights on which we have to dwell when we are dealing with that important industry. If I spoke somewhat hurriedly, in the interests of putting my points as briefly as possible, I hope no one will think that I have no great enthusiasm both for the idea of development councils, including this one, and also for what we hope will be the prosperity and success of this industry in the many great national tasks it has taken on, including not least the export trade to which the hon. Member for Hallam (Mr. Jennings) referred. Like him I desire to pay tribute to what this industry has done in all sections—or as he would say, all the industries—in face of great difficulties, especially the import restrictions of other countries.
I, like a number of hon. Members, do not want to enter into the "scrap" between Sheffield and Birmingham. I had round my table in the Board of Trade some months ago representatives of all sections of the trade from all the principal centres of production. I am not sure whether or not the North of Scotland was represented. At that time I could see there was some feeling between these centres of production and the different sides of the industry. Anything I have said tonight about Sheffield I hope will not be taken as a reflection upon Sheffield but as a reflection upon the inability of the various sections of the industry to co-operate with one another. I should not like to take sides in the various allocations of blame which have been made as between those two great Cities which now seem to be united only in their lowly position in Division 1 of the Football League.
I want to put straight a point raised by the hon. Member for Hallam about the meeting which took place in my room in March last. At that time I gathered it to be the view of all sections of the industry that they were prepared to have this development council and to have a single development council. Certain arguments were put of the kind advanced by the hon. Gentleman but, certainly at the end of the meeting, there was no doubt expressed that this was going ahead as an agreed development council cover-

ing the whole industry. As to the question raised by the hon. Gentleman, I have here an extract from the minutes of that meeting. The representatives of the Sheffield side inquired whether it would be possible to have a separate development council for the silver trade and, quoting the minutes:
The President said that the industry was one, and its size would not warrant a separate development council for silver. It was quite possible for a single development council to treat the two branches of the industry separately.
That may have been the assurance to which the hon. Gentleman was referring, and that was a point which has been taken up by the silversmiths in their comments on the draft order.

Mr. Jennings: Will the right hon. Gentleman say something about the method?

Mr. Wilson: Certainly. The silversmiths, of course, together with the several fundamental, almost wrecking Amendments which they sent in on the draft order, suggested a separate organisation for silverware. We did not feel able to accept that, for a number of reasons. First, the other organisations were not willing to accept it. Secondly, we thought it inadvisable to tie the council in advance to any particular arrangement which it must make for the conduct of its business. Certainly it is for the council to set up this kind of committee if it so desires, and to have a separate organisation for the different sections or for any appropriate sections of the industry. It would be quite wrong for us to lay down in the order the way in which the council should go about its business. Even so, if by conceding this point we could have secured the genuine support of the master silversmiths for the council, perhaps it might have been worth while risking upsetting strongly the other trade associations concerned, but it was quite clear that even if we did accept this, the other points made by the Master Silversmiths' Association were of such a fundamental character that we should not have secured their support for the council generally.
Before I conclude, there are two points on which I want to comment. First, I wish to express my agreement with what was said by the hon. Member for Bucklow. It may well be that there has been a misunderstanding about what


a development council can do and cannot do. I associate myself with most of what he said as to the limitation of its powers. Many of those people in other industries seemed to think that a development council could exercise rights of interference with day-to-day management and could do many of these other things—purchase of machinery for the industry as a whole, and so on. These people are misleading themselves, and that may be one of the reasons there is in certain quarters opposition to development councils. Those industries with which I have discussed the problem have been left in no doubt about the exact powers that a development council may exercise.
Finally, may I comment on one of the points made by the hon. Member for South Edinburgh (Sir W. Darling) about the right to require information. He seemed to think this would mean the production of books by some of these small working masters for the benefit perhaps of their large-scale competitors. If he will turn to paragraph 7 (2) he will find there is adequate protection there that:
where a requirement is imposed by the Council under the provisions of this Order to furnish returns or other information … the Council shall ensure that the returns or other information shall be furnished to, or the examination done by, independent members of the Council designated by the Board of Trade or to or by officers of the Council specially authorised in that behalf by the Council.

Sir W. Darling: That is not a protection.

Mr. Wilson: I think the hon. Member will feel that that is a satisfactory protection. I hope I have dealt with most of the points and recognising, as I do, that there are mixed feelings in one or two sections, I hope they will forget some of their difficulties. I am quite sure that once this House has approved this order, all sections will forget their differences and will feel that it is right for them to co-operate and make a thorough success, not only of the development council, but of all those instruments of co-operation which are so badly needed in this industry.

Mr. Jennings: Before the right hon. Gentleman sits down, may I ask him whether he does not appreciate the strong case put forward by Sheffield, that he is taking these two industries together and talking about them as one, whereas the silversmiths are one industry and jewel-

lery is another. We can never get the silver people to agree that it is one industry.

Mr. Wilson: I recognise the strength of their feeling on that matter. It would not be possible to be in the same room as the Sheffield silversmiths for five minutes without realising how strongly they feel about it. But after having two full discussions with the silversmiths, I was satisfied it was right to have a single body for the industry, as I would regard it, and at the last meeting which I had with them I thought they were equally satisfied.

Resolved:
That the Draft Order, entitled the Jewellery and Silverware Development Council Order, 1948, made by the Board of Trade under Section 1 of the Industrial Organisation and Development Act, 1947, a copy of which Draft Order was presented on 29th November, be approved.

Orders of the Day — BRITISH ASSETS, BURMA (COMPENSATION)

Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Wilkins.]

7.31 p.m.

Colonel Crosthwaite-Eyre: In the last few months a number of Questions have been asked in this House about what action the Government are taking to safeguard British assets abroad. Whatever view hon. Members in one quarter or another may take, one thing is quite certain, that these assets have not been safeguarded. One has only to think of the sorry history of how the Government has traded away our assets in the Argentine and have allowed our assets in Roumania and Poland to be taken from us to realise that, instead of fulfilling the prime duty with which any Government is charged—that of looking after the interests of their nationals who may own property abroad—the Government have let one asset after another vanish and disappear.
I want to raise tonight the question of Burma. I have carefully restricted the subject to one country because any debate of a general nature might allow the Government to ride away on general observations. But if we take one country only—and one which is typical of what


has happened in others—we shall be entitled to expect a clear answer from the Government as to what they have done and why they have allowed the present situation to arise.
Under Article 7 of the Treaty which recognised Burmese independence, the British Government rightly maintained that all British concessions, contracts and rights of property which had been guaranteed by the previous Government of Burma should be guaranteed equally by the new Burmese Government. And very rightly, since it would not be possible for a commercial treaty to be negotiated before Burmese independence was effected in January of this year, an exchange of letters took place between the Prime Minister and Mr. Thakin Nu, the then Prime Minister-designate of Burma, to emphasise the requirements of Article 7. I draw the attention of the House to those letters, which are published as an annex to the Treaty, and particularly to letters 1 and 2. Paragraph 2 of the first letter, written by the Prime Minister, says:
I have, therefore, to express the hope that the Provisional Government of Burma will not during this interim period take action which would prejudicially affect existing United Kingdom interests in Burma.
Mr. Thakin Nu, in replying to the Prime Minister, said that he accepted that that should not be done until the commercial treaty was made. But he went on to say:
I have, however, to explain that this undertaking must be read as subject to the provisions of the Constitution of the Union of Burma as now adopted, and in particular to the policy of State Socialism therein contained, to which my Government is committed.
It is not for me to argue now what that policy of State Socialism has meant. Mr. Thakin Nu, however, said that if this policy meant the expropriation of British assets, he would see that equitable compensation was paid. It is fair to say that on the day that Burmese independence took place His Majesty's Government, both by Article 7 and by this exchange of letters, had seen that, in addition to written treaty obligations, specific assurances were obtained that British assets would be respected and that the Government of Burma would be fully responsible for seeing that no British right, concession or property should be in any way affected by the transfer of

power from this country to the Burmese Government.
But what has happened? I think it is reasonable to take the case of the Irrawaddy Flotilla Company as a typical example. Here, apparently, a Bill was introduced into the Burmese Legislature and passed all its stages in one day, 19th April. No opportunity was given to the company to make any representations or to state its case against being taken over. The Bill, which became law, gave no indication of which assets of the company were to be taken over. It made no reference to compensation but said merely that, pending a settlement, the expropriated assets of the Irrawaddy Flotilla Company would be hired by the Burmese Government on terms to be settled at some later date.
After the Bill was passed, a committee of three was established, consisting of a judge of the Rangoon High Court, a representative of the Burmese Government and one from the company. This committee was to try to iron out the method in which this transfer should take place. It was laid down that the transfer should take effect not later than 1st June, giving a matter of some six weeks only for the transfer of this company, with its very varied and very large assets, to take place. On 1st June, however, the committee had reached no solution at all to any of these problems. It had still to find what assets were to be taken over and their value. It had made no arrangements about the method of payment of compensation or the total sum that might be expected to he paid as compensation. 
On 1st June the assets of the company were expropriated and it was left completely in the dark as to its future. In July, a month after the expropriation, this committee which was sitting to try to assess compensation was dissolved. A new committee was established, with the same judge as president, but with the secretary of the Planning Department of the Burmese Government and a member of the Burma Corporation as its two further members. I understand the reason for the change was that the first committee was considered to be too prejudiced on both sides. That prejudice is, perhaps, understandable when one realises that the Irrawaddy Flotilla Company has submitted a claim for over £1frac12; million compensation, but that the


Burmese Government are willing to pay only £200,000, or something like one-eighth of what is claimed. Although no decision has yet been reached, the only information which the company has got is that payment, if and when it is made, will probably be made in non-negotiable bonds.
The first question I should like specifically to ask the Economic Secretary to the Treasury is how he manages to square this position with the statement of the Minister of State, who, in answering a Question in this House on 21st June, said:
… we have made it plain from the beginning that the Burmese Government must be able to meet in an acceptable currency the legitimate claims of British subjects …"—[OFFICIAL REPORT, 21st June, 1948; Vol. 452. c. 932.]
It does not seem very fair to find, six months after the expropriation of the company, that all it can now expect is non-negotiable bonds.
There are many further examples of what has happened to British assets in Burma, but I will quote only two others. The first is of a small private company, Kyautaga Estates, owning something like 40,000 acres of rice land. The Burmese Government decided to take it over and the method they employed was deliberately to encourage banditry and dacoity so that in fact the estate could not be run. Then they informed the estate that it was impossible for it to run its affairs and they proposed to expropriate it. They then did expropriate it and no compensation has even been agreed up to the present. It reminds me very much of what happened in Roumania in regard to the equally valuable assets of the Astra Romana oil undertaking. Then there is the case of Messrs. Foucar and Company, Limited, Teak Estates. At short notice they were told they would be expropriated and negotiations have dragged on, not only during the short period between notice and expropriation, but until now. The company has lost all its assets and it has no idea what compensation it will receive, nor when it will receive it.
In 1941, the then Government of Burma instituted a War Risks Insurance Scheme. Under this scheme it was mandatory for anyone who owned goods to the value of more than 15,000 rupees to insure. In 1941 and 1942, when the

Japanese invasion took place, it was the policy of the Government to deny to the Japanese the use of any material or stocks that might be left behind when they retreated. The Irrawaddy Flotilla Company, for instance, lost a large percentage of their shipping; other companies their crops of rubber and other commodities which were destroyed.
So long as the late Government existed, it was agreed that all that would be covered by the War Risks Insurance Scheme, but, quite suddenly, since independence has taken place, the Government of Burma have repudiated all these claims and have said that whatever assets may have been destroyed, that is the funeral of those who owned them and that Burma was not concerned as it was not a war in which Burma took part. I suggest that under Article 7 of the Treaty clear obligations are set out, but here is unilateral repudiation and, as far as I am aware, His Majesty's Government have taken no direct action at all. In fact, the only concrete statement which we have is that made by the Chancellor of the Exchequer on 9th November in which he said:
As far as I am aware there has been no request for us to give any assistance."—[OFFICIAL REPORT, 9th November, 1948; Vol. 457, c. 1378.]
I am certain that the Economic Secretary will agree that the Irrawaddy Flotilla Company asked for assistance in April this year and I also believe Messrs. Foucar and other companies have also asked for assistance. I admit the Chancellor did me the courtesy of writing on 12th November and saying:
I should perhaps have made it clear that whereas we have not taken part in any detailed discussions between the firms and the Burmese Government and have not identified ourselves with the amounts of claims put forward by the firms, we have continuously pressed the Burmese Government to carry out the undertaking given ….
It seems to me very weak if that is all His Majesty's Government have done—to press the Burmese Government. Surely it is their duty to identify themselves with individual claims and to press them to see that no British individual, and no British company, shall suffer because of unilateral action by a foreign power. I hope the Economic Secretary will give an assurance that in future, any British interest or any British company in Burma, or for that matter anywhere else, that


feels it is injured can appeal to His Majesty's Government with confidence that if its claim be just, it can have the full weight of His Majesty's Government behind it.
I much regret that hon. Members opposite seem to take a rather impish delight in seeing British assets destroyed. They seem to take the view that every time a British interest abroad is expropriated, a little more of wicked capitalism is destroyed.

Mr. Tolley: Will the hon. and gallant Member give some instances?

Colonel Crosthwaite-Eyre: When the question of Burma was raised on this side of the House on 9th November, there was a perfect example. Every time a British asset is expropriated without compensation it has a vital effect, not only on our balance of payments, but even on our ability to buy food and raw materials which we need in the immediate future. Every time an asset goes, so does our position become worsened and our resources for gaining foreign currency depreciate. Burma has obviously flouted its agreements and repudiated that to which it set its name only a few months ago. On the other hand, we give Burma the right to acquire £2 million of hard currency against sterling. It is a favour to a country to allow it to trade on our hard currency resources of which we ourselves stand so desperately in need. Surely if Burma has that sterling with which to pay us, it should have been used to pay compensation for companies which have been expropriated, rather than being used, and allowed by His Majesty's Government to be used, for obtaining hard currency at our expense. I hope that we can have a reassuring statement tonight from the Economic Secretary, assuring us not only on the particular cases in one country which I have raised, but also that His Majesty's Government will see that British interests throughout the world receive a square deal.

7.47 p.m.

The Economic Secretary to the Treasury (Mr. Douglas Jay): I can assure the hon. and gallant Member for

New Forest and Christchurch (Colonel Crosthwaite-Eyre) that we are every bit as insistent as he is that equitable compensation should be provided by the Burmese authorities for British property nationalised in Burma. In fact, as he said, we secured an undertaking from the Burmese Government in the exchange of letters between the two Prime Ministers on 17th October, 1947, that "equitable compensation"—those were the exact words—should be paid; and since then we have repeatedly pressed the Burmese Government to make arrangements for such compensation. I can assure the hon. and gallant Member that we shall continue so to press until that is done. In addition, we have indicated to the Burmese Government that we are ready to discuss the precise interpretation of the undertakings which they gave to grant equitable compensation. I can also tell him that we are not yet satisfied with the response we have had to those recommendations. He said that in one case non-negotiable bonds had been offered as compensation——

Colonel Crosthwaite-Eyre: No, may 1 correct that? I understood that was to he the general means of compensation.

Mr. Jay: If that were the case, we should not be satisfied either.

Colonel Crosthwaite-Eyre: May I appeal to the hon. Gentleman to go further and say that he will not accept it?

Mr. Jay: What I would prefer, since it is not the Government who are accepting the compensation but the companies, is that we should not be satisfied with a general method of compensation which did not provide for payment in convertible currency. We are no less determined than the hon. and gallant Member to insist that equitable compensation is in fact provided. The only question which divides us is how that undertaking can be pressed. The Burmese have given us the undertaking and the issue is really what is the best method and the wisest course for the British Government to adopt to ensure that that pledge is carried out. In our view the adoption of any more extreme measures than we have taken at the moment would not be calculated to accelerate the payment of compensation to the British companies.
As the hon. and gallant Member knows, the Burmese Government have been engaged in allaying disorders in their own country and those disorders have as a result affected their rice exports and foreign exchange resources. If compensation is to be paid, and paid in convertible currency, two things are obviously necessary—first the co-operation of the Burmese Government in the whole transaction, and secondly the recovery of Burma's economic fortunes. In our view, the adoption of any sort of drastic measures at this moment would not help to achieve either of these aims and, therefore, would not accelerate the payment of the compensation which we all desire. Burma's present financial position is not strong, and within the next few months she may be well short of sterling. With the present keen world demand for rice, however, the situation might soon improve if settled conditions returned in Burma and if rice exports began to increase again. We must do all that we can to ensure the return of such conditions so that payment of compensation in convertible currency may become possible.
The hon. and gallant Member accused us of having been weak in not going beyond the measures which we have already taken. I think I understood him to suggest or to imply that perhaps we ought to take some step to earmark or even impound some of Burma's sterling balances now in this country. If the hon. and gallant Member did not suggest that, there is no need to argue the point. If he did suggest that, I should have to remind him that the major part of these balances represents the backing of Burma's currency, and that it would be a very drastic step indeed to do anything of that kind.
The hon. and gallant Member also mentioned the £2 million of hard currency which, as he quite correctly said, we agreed to grant the Burmese Government for the second half of the present year. I know that the hon. and gallant Member has his own conception of the sterling area system by which, although most or all of the countries which are members of it contribute hard currency to the central reserves, apparently only the United Kingdom is to be allowed to draw hard currency out of it. That is not a conception which, if it were put into practice, would make the sterling

area popular or indeed very enduring. So long as Burma is a member of the area, and, in particular, a member who is able to conserve the resources and economic strength of the area by rice and other exports, she must be allowed reasonable access to the central reserves, like any other member, for essential purposes. In the agreement to grant that hard currency the usual safeguards were inserted.
I do not think that the hon. and gallant Member really made any other practical suggestions by which we could really accelerate the payment of this compensation. As I have said, it is our aim to ensure that compensation is paid for those properties at the earliest possible moment. We are taking all the steps which in the circumstances seem to us best calculated to achieve that aim. I think that on the whole the British Government, with the information they have at their disposal, are probably the best judge of what methods are likely to bring about that result. Nothing that the hon. and gallant Member has said this evening has weakened my belief that any more drastic and extreme measures would do more harm than good.
I should like to assure the House that we do not in any way dissent from the view which the hon. and gallant Member has put forward that the Burmese Government must continue to be pressed to carry out their perfectly clear pledge to grant equitable compensation in all these cases.

Mr. Eccles: Will the Economic Secretary say a word about the claims of the British companies for the stocks which they destroyed, on orders from His Majesty's Government, to prevent them falling into the hands of the Japanese? Do the Government take any responsibility for those losses or not?

Mr. Jay: That comes under the heading of war damage compensation, which is a separate issue from compensation for nationalisation. However, we have not overlooked those claims. Negotiations are going on about them at the present time; but as I say, it is a separate issue.

Colonel Crosthwaite-Eyre: As this particular scheme was initiated by the late Burmese Government, which was responsible to His Majesty's Government, can it be assumed that in default of any other solution, all these claims will be met by His Majesty's Government?

Mr. Jay: His Majesty's Government are taking part in the negotiations. We intend to see that these claims are not overlooked. I cannot say any more in detail at the moment because conversations are going on.

Orders of the Day — CURRENCY TRANSFERS ABROAD

7.56 p.m.

Mr. Godfrey Nicholson: I find myself in some difficulty. I propose to raise a matter of some constitutional and financial importance which affects the Chancellor of the Exchequer and, naturally the rest of the Treasury, but I see no representative of the Treasury who can reply to the Debate, for the Economic Secretary has already spoken on this Motion. I very much hope that the Chancellor will join us before I have proceeded much further in my remarks.

Mr. Jay: My right hon. and learned Friend the Chancellor is in the House and will be in the Chamber within a few moments.

Mr. Nicholson: I expect that he is drinking an extra strong glass of water. I am glad to see that the Chancellor has arrived. It raises my spirits.
In the last few weeks series of Questions in the House have aroused considerable public interest. They have been concerned with the workings of the exchange control in so far as it concerns France, which I need hardly remind hon. Members is a soft currency country with which we have a favourable balance of trade. These Questions have touched upon such various subjects as the tourist allowance of £35, the permission to transfer funds to France for the erection of war memorials in the case of at least two Divisions, and the gift by Scottish miners of £1,000 to Communist strike funds or similar quarters. They have concerned gifts and loans by the Trades Union Congress and by the Labour Party to La Force Ouvrière and a newspaper called Le Populaire.
The purpose of these Questions was not to badger Ministers but to elicit information. It has been a most laborious process of question and answer. Information has not seemed to be very ready to be elicited. It has reminded me of nothing more than trying to draw a reluctant cork

from a badly made bottle. But we have assembled enough information to entitle us to demand clarification and explanation from the Chancellor and, we hope, a retraction and recantation of the attitude which he has taken up.
Arising out of this information, we on this side of the House feel increasing uneasiness and disquiet under four main heads which I shall later elaborate. We feel that the administration of the exchange control in so far as it concerns France is confused and capricious. We feel that the answers given in the House have often been evasive and have sometimes lacked candour. We detect evidence that exchange control is manipulated with political bias. That is a very grave charge. And we want to know not some but all the truth. We want to know how far this contamination by political bias of the mechanism of exchange control has gone.
I should like to take the House briefly through this series of Questions which have been asked and answered. The first matter concerns tourist allowances, which I need not labour beyond saying that I derived the impression from the Chancellor that he was anxious that more sterling should be spent in France, but that the chief obstacle was an agreement with the Swiss Government which limited the amount of sterling to be spent in France. We had a series of Questions connected with war memorials for two Divisions. I would like to call the attention of the House to one or two phrases used by the Chancellor in reply. He said that these cases were not dealt with on the basis of merit. His words were:
I am not dealing here with the merits of the cases but with the amounts of money."—[OFFICIAL REPORT, 23rd November, 1948; Vol. 458, c. 1074.]
In a later answer not concerned with war memorials he pointed out that charities were rationed for this purpose by a quota. The third group of Questions concerns the case of the grant by the Scottish section of the National Union of Mineworkers of £1,000 to the Communist strike funds in France, ostensibly for the relief of suffering women and children.

Mr. Emrys Hughes: Why "ostensibly"?

Mr. Nicholson: I say "ostensibly," and if the hon. Member will restrain himself for a moment he will see that I am


using the word because of what the Chancellor himself said. That it was an extraordinary gift will be seen when I read the Chancellor's reply on this subject. He was asked what steps he had taken to concern himself that these funds will be used for charitable purposes, that is why I used the word "ostensibly." He said:
I have taken no steps to that extent—except the statement and undertaking of the people who transmit them."—[OFFIctAt, REPORT, 11th November, 1948; Vol. 457, c. 1726.]
Whereupon the hon. Member for Orpington (Sir W. Smithers) made the typical and exceedingly appropriate remark of, "Up the Reds."
I do not wish to go into great detail over this extraordinary permission to allow funds to go through for this purpose while other and more pressing needs were rejected. So many cases have been brought forward and all are pressing needs. There are people who wish to go back to France, which is their native country, to retire. There are people who want to send money to old servants in France, and so on. I would refer to one particular case, which, if the right hon. Gentleman will read the "Glasgow Herald" of 27th November, he will see to be a very striking case. I wish to bring the House to the most startling and disquieting statement of all. On 30th November, the Chancellor was asked by the hon. Member for Sutton Coldfield (Sir J. Mellor)
the principles upon which he permits, or refuses, the transfer of money abroad by individuals or organisations for political purposes.
There was such a startling, staggering answer that I ask the House to listen to it very carefully. The Chancellor said:
All applications must be considered on their merits …"—
and I would point out that I have just told the House that applications for war memorials are not considered on their merits. He went on to say:
If there is no exchange difficulty, then, broadly speaking, I"—
and I would ask the House to remember that he uses the word "I"—
would approve contributions made for the purpose of strengthening the democratic forces in any country, and I would disapprove contributions made to organisations whose activities are hostile to that purpose."—[OFFICIAL REPORT, 30th November, 1948; Vol. 458, c. 165.]

That was a startling statement for many reasons. First, it showed that the principle of political discrimination had been introduced into exchange control. Secondly, it really was a rather stupid definition, because it did not seem to help him at all. It enabled him to be both Communist and anti-Communist at the same time, a very comfortable and convenient form of united front. Thirdly, it showed a departure from the traditional British attitude that we should not support, at the whim of a particular statesman as a member of a particular party, particular political parties in foreign countries. It has always been the tradition of this country that British statesmen in dealing with foreign Powers and countries have to regard themselves as the representatives of the nation and not as the representatives of a political party. I think when the significance of those words sink in hon. Members on both sides of the House will be amazed.
Then I would call attention to another series of Questions and answers last Thursday, 2nd December. This concerned the gifts to Le Populaire and the loans to Force Ouvriere. It came out that the Trade Union Congress had lent £5,000 to La Force Ouvriere and that the Labour Party had presented £1,000 to Le Populaire. Those facts did not emerge in this country, but in the French Chamber. If it had not been for Communists in the French Chamber making a fuss about it and saying that they were not allowed to receive funds from Russia and why should their Socialist competitors receive funds from the Labour Party in this country, we in this House and this country would not have known anything about it. It is a hole and corner matter.
I do not propose to lead the House through all the questions and answers but there is one sentence which is too good to miss, enunciated by the Financial Secretary. He said:
 The purpose of the applications in each case was to strengthen the financial position of the institutions concerned.
It is a phrase which I shall use when I try to borrow five bob from anybody in the future. But there are certain points. The Financial Secretary said that what the Chancellor had done was to:


follow the usual practice and treat these transactions as they come on their merits."—[OFFICIAL REPORT, 2nd December, 1948; Vol. 458, c. 2177–8–9.]
"On their merits." Political questions are treated on their merits. Political applications are treated on their merits but applications for war memorials, and possibly other applications, are not treated on their merits. That emerges quite clearly from these questions.
Then there were Questions yesterday which seem to merit some attention. The Chancellor was asked:
To what extent he personally investigates and approves the authorisation of every transfer…
I asked him this Question and in reply he said:
I accept full personal responsibility for all decisions taken by the Treasury.
That, of course, is not the answer to my Question and I pointed that out. Then he said:
I am afraid it is not possible, because in the ordinary course of administration some cases may be decided in one way and some in another.—[OFFICIAL REPORT, Tuesday, 7th December, 1948; Vol. 459, c. 270.]
The hon. Member for Cambridge University (Mr. Pickthorn) pointed out the extraordinary implication of those words. The Chancellor said that civil servants took these decisions. In many cases a civil servant is deputed to decide political applications on their merits. I think that is a very serious state of affairs.
I do not wish to say any more about the war memorials because the Chancellor has, very rightly, in my opinion, recanted. He has seen that his refusal to allow funds for that purpose was contrary to public sentiment. Whether he has been convinced himself or not I do not know. But I congratulate him, and I hope I shall induce him to retract the extraordinary statement he made about allowing applications for political purposes to be decided according to his own whim and personal views.
I wish to elaborate the nature of our anxieties. First, as to the administrative muddle. It is quite clear that too many people are involved, that decisions are not consistent, and that they are capricious. We are also worried that civil servants should have to exercise

political discrimination. Or do they? Or is it the Chancellor himself who decides in the political cases? We are worried because the whole thing is wrapped in administrative secrecy. They are matters which concern the whole public of this country. If I apply to send my grandmother to the mountains to recover from bronchitis it is a private matter and no business of the general public. But it is the business of the general public where political matters are concerned and when the Government are involved in effect, in subsidising political parties in another country.
There can be no room for secrecy there. Secrecy there is a crime. I think that all of us are worried about the evasiveness and lack of candour which has been shown. One would think that when one puts down a definite Question to the Chancellor of the Exchequer, a definite answer would be given whether it be favourable or unfavourable. But in answer to the Questions which I put down in two cases a definite answer was not given and the wrong Question was answered. I asked for a list of charities and political or quasi-political bodies to which payments had been authorised. The answer I received was about the number of charities and political or quasi-political authorities which had been authorised to send money. No reference was made to those to whom payments had been authorised. I asked another Question and again the wrong answer was given. There has been considerable evasiveness and lack of candour on the part of the Chancellor of the Exchequer and the Treasury. The whole chain of incidents has had to be painfully extracted. I want to know whether we know everything now, whether we know the full extent to which this partisan discrimination has been exercised.
The third anxiety which we feel is due to the fact that we think that it is wrong and contrary to British constitutional practice for party political bias to be exercised in relation to foreign countries. Cabinet Ministers should speak for the nation and not for a political party. I suppose it is vain to preach that doctrine to the party opposite. It is symptomatic of Socialist thought and practice, as it is of other totalitarian regimes, that they are right and everybody else is wrong, and that minorities which disagree with them


have no right to have their opinions expressed. [Interruption.] If that is not the case and if I am wrong, how do hon. Gentlemen opposite explain the fact that the exchange control mechanism is being wangled and gerrymandered in order to support Socialism in foreign countries? That is admitted.
Hon. Gentlemen opposite should ask their own Chancellor of the Exchequer to deny it. They should ask him to give the House a list of organisations to which contributions have been permitted. If my suggestion is then not perfectly justified, I will withdraw and apologise. Until that is done, until we know the full list of the charities in the different countries in Europe to which contributions have been permitted, then I say that these funds have been gerrymandered for the purpose of Socialist Party politics. It is a regrettable departure from British political tradition and I cannot regard it as honourable conduct by the right hon. and learned Gentleman. How far has it gone? Were payments permitted to Signor Nenni, to Herr Schumacher and to Signor Saragat? How has the exchange control machinery really been operated?
My final point is one on which I have already touched. It is to inquire how the Exchange Control Act has been used. I must point out to the House that it is by far the most powerful weapon in the whole Government armoury. None of the other powers they have taken to themselves is half so powerful as this weapon, which is all-pervasive, all-powerful, and exercised in secret. If it is believed that the Exchange Control Act is being manipulated for party political purposes, there will be the same loss of public confidence as there would be if the right hon. and learned Gentleman introduced party politics into the affairs of the High Court or the Inland Revenue. Every activity of the Government in which political discrimination may occur must be open and public. I defy any hon. Gentleman opposite to deny that that is sound constitutional doctrine. I think we all agree on that. We do not want party political discrimination, bias and prejudice exercised in secret. I am sure that the whole House is with me in that opinion. I do not believe that any hon. Gentleman can deny, after what I have said—if the Chancellor does not deny it, and I do not think that he can—that grave suspicion

rests on the right hon. and learned Gentleman of having exercised party political partisanship and bias in secret in the manipulation of the Exchange Control Act. That is dishonourable, and I say that he must clear himself of that charge. The Chancellor has been wise enough to retract on the question of war memorials. If he is a wise man he will retract the extraordinary statement he made on 30th November when he said:
I would approve contributions made for the purpose of strengthening the democratic forces in any country."—[OFFICIAL REPORT 30th November, 1948; Vol. 458, c. 165.]
Who is to define the democratic forces in any country? At a meeting in London the other night the Communist Party collected funds for guerrillas in Spain. Will the Chancellor approve of that? I do not suggest that he should or should not. He approved funds for the Communists in France. Does he regret that or does he not?

Mr. Emrys Hughes: When did the Chancellor approve of funds for the Communists in France?

Mr. Nicholson: The trade unions gave £1,000 to the French miners who were on strike.

Mr. Hughes: The hon. Gentleman said "Communists."

Mr. Nicholson: Of course they were Communists. I do not know whether the hon. Gentleman is anxious to claim credit or discredit for the Communists.

Mr. Hughes: It was a gift from Scottish miners to miners in France.

Mr. Nicholson: Scottish miners made the gift—but we will not go into that. Many of the miners who were on strike in France claim to be Communists.
The Chancellor must retract his fantastic statement which will put him and the Government in a false position for all time.

Mr. Carmichael: The hon. Gentleman would be worried by that.

Mr. Nicholson: I beg the Chancellor to "come clean" and to be man enough to recognise that he has got himself into an awkward position or that his Department have got him into an awkward position. I ask him to "come clean"


and to restore the traditional position of British statesmanship which was that in so far as their dealings with foreign countries were concerned, Cabinet Ministers speak for the nation, and that in so far as political bias and discrimination came into discussion, they should never act in secret but always in the fierce light of day.

8.17 p.m.

Mr. Proctor: I wonder upon what principles the hon. Member for Farnham (Mr. Nicholson) is proceeding. As he was speaking I wondered why, when the question of Greece was discussed in this House, he never gave full support to the opinion of some of my hon. Friends who were against using Government funds for the assistance of the Government in Greece. It appears to me that if this principle were really applied he should have protested loudly then. But it is only now when private funds are being sent to support the Socialists in France that the protest is made.

Mr. Nicholson: The difference lies in this. In Greece we are, rightly or wrongly—and I am not discussing that—supporting a regime which is a coalition of several parties. It would be completely wrong in my view to send funds to one of those parties, but if we are under a contractual obligation to support a regime, I suppose we must support it with Government or any other funds. It is the giving of funds to one political party—to one section—which is clearly wrong. If the hon. Gentleman cannot see that point, I am much surprised.

Mr. Proctor: I am obliged to the hon. Gentleman. It still seems to me inconsistent on the part of the hon. Gentleman. He is objecting to the Government of this country using funds for the purpose of upholding a political party or set of parties. There is an Opposition and there is a Government in Greece and he should be objecting to any support given there from Government sources. I should like to point out the special difference between these two cases. It has been a tradition of the British people that we should not interfere in the politics of other lands. That is a principle which we may or may not be able to sustain in the future. As to the question of

using funds to maintain political parties in other countries, we have got to examine that situation and see whether or not the principles which we have applied in this country continue to apply in the world.
There is nothing sacred about that idea. There has never been in this country a tradition or any accepted agreement that a British political party cannot assist another political party in any quarter of the world. There has never been anything to prevent a British citizen from assisting any other person in any other country is he so desired. The only difficulty at the moment is that we have not the financial resources to allow that to be carried on in the same way as in the past. Therefore, we have the principle that the British Government have the right to use the funds of the people of this country in the interests of the people of this country, and they have the right to prevent any funds from being sent out of this country. It is fortunate that they have this right; otherwise many unpatriotic wealthy people in this country would have denuded this country of whatever wealth it possesses. They have already done so to a large extent, but there is a control on them, and it is right that there should be such a control.

Mr. Ellis Smith: Surely, my hon. Friend remembers that in the past the British Government sent millions of pounds to support the Royalists in France, in particular during the French Revolution.

Mr. Proctor: I will accept that from my hon. Friend. Suppose the United Europe Movement in this country wished to support a similar kind of organisation on the Continent of Europe with funds, there is no principle which would prevent that from being done.

Mr. Nicholson: Hear, hear.

Mr. Proctor: The hon. Gentleman says "hear, hear" when it relates to the United Europe Movement. Why does he not agree that British Socialists should support French Socialists?

Mr. Nicholson: I am in favour of Communists and anybody else being able freely to support the people with whom they are in sympathy in other countries,


but I am not in favour of putting in the hands of the Chancellor the power to say which shall be sent and which shall not be sent.

Mr. Proctor: We are not in a position to allow anything to be done which is against the interests of the main policy of the British people. It is mainly on the grounds of the stringency of our resources that we are not able to assist other countries. The hon. Member for Farnham (Mr. Nicholson) said that a British statesman, when he deals with another nation, does so as a representative of the nation and not of a party. No British Government funds are at stake in this matter. No British funds have been used to support either the miners who were on strike or the French Socialist newspaper. It is private funds that have been allowed to be transferred from one country to another for that purpose. I stand by that principle and I say that it is right that that should be so. It is also proper that the Government of the country should claim the right, as every Government must, to say whether or not a transfer of funds from this country to another is in the interests of the people of this country. As far as possible, every Government should allow liberty on those lines for all parties to contribute.

Mr. Nicholson: All or none.

Mr. Proctor: But apparently the hon. Gentleman's basis of complaint is that none should be allowed to contribute. In Europe today the greatest British interest is the preservation of democracy on the Continent of Europe. Any Government would be false to the true interests of the British people if they failed to support democracy on the Continent of Europe. On that basis, I say that the British people can assist the democratic forces in Western Europe, and there can be no complaint whatsoever on that score. No vital principle has been violated by the Government in this matter. It has been a long-established tradition that the British working class should claim the right to assist those in other countries who hold similar opinions to those which we hold.
We are not a nationalistic movement. We are a worldwide movement; we believe in international Socialism. I say to hon. Members opposite that if they were to deprive the forces of democracy

in Europe of the right of looking to democrats in this country for sustenance, assistance, support and comradeship, they would live to regret it, because it would mean not only the end of democracy in this country but the end of this country, as a national unit, in the affairs of the world. It is on that serious plane that hon. Members opposite ought to consider what they are doing. One cannot in one breath say that one is in favour of democracy, and then adopt a principle which means the death of democracy in Western Europe.

8.27 p.m.

Mr. Henry Strauss: There is one point, I think, on which I agree with the hon. Member for Eccles (Mr. Proctor). and it is that this problem arises on account of exchange control. So far as that is the basis of his argument, I agree that it is on account of exchange control that this question has arisen. But I hope that it will be possible to explain to hon. and. right hon. Gentlemen opposite why we think that a very serious mistake has been made, and that issues are involved on which I hope that some, at any rate, of the hon. Members opposite will sympathise with us and on which they will agree with the view that we put forward.
Let me take the Exchange Control Act. That puts the people of this country, including legal persons—that is to say, companies, trade unions—as well as individual natural persons, under great and very irksome restraints. The case for the Government is that those restraints are necessary. But let hon. Members realise how great a tyranny may be involved in the exercise of this control.
Let us take, first, an example that has nothing immediately to do with this transfer of funds. Let us take the arbitrary decision by the Government as an act of tyranny to decide between people's pleasures. They say "We can decide as a Government that so much money in foreign exchange has got to be expended on importing the bilge of Hollywood, but that hon. Members are not to be allowed to travel freely abroad." The man who wishes to indulge in foreign travel or buy a foreign book is not to be allowed to do so, though the money that would enable-him to do so can be legitimately


expended on the purchase of American films. That can be arbitrarily decided by the Government.
I say that that is a very considerable inroad into public liberties and an exercise of tyranny which would be very dangerous and onerous in any event, but is rendered just tolerable if it is uniform. If, that is to say, the Government say to the people of this country—and are prepared to justify it in Debate in this House—" We will stop all persons irrespective of their politics from travelling abroad, except to the extent of the expenditure of £35 this year and some other amount another year," that would apply to all persons uniformly. Suppose that the Chancellor of the Exchequer, instead of adopting uniform limits for all foreign travel under this Act, were to say, "I will give such sums as I think fit to those who I think will aid democracy abroad, but will refuse it to those about whom I am less confident," then I hope that hon. Members in every quarter of the House would say that that would be quite intolerable.
What do we find when we get to these transfers abroad for charitable purposes or to political parties? Surely, there is the same absolute necessity for complete uniformity of procedure and for the whole thing to be subject to rules which can be known to the public of this country and debated in this House. The hon. Member for Eccles drew, I thought, a quite ridiculous parallel when he took the case of payments to the Greek Government by our Government. I am not going to debate whether that is good or bad, but it is a payment by a Government to a Government, which is well known and debatable in this House. What we are here concerned with is the transfer by private individuals or by institutions to private persons or institutions abroad. In that case, we say that it is really intolerable that this should be decided by the whim, or even the opinion, of the Chancellor of the Exchequer. Of course, I give the Chancellor of the Exchequer the credit for deciding to the best of his ability on the principle which he himself enunciated in the Question quoted by my hon. Friend——

Mr. Palmer: Who else does the hon. and learned Gentleman suggest should decide, except the Chancellor of the Exchequer?

Mr. Strauss: If the hon. Gentleman had waited he would have found that I was going to deal with that. I say that it is quite intolerable that anybody should have to decide.

Mr. Palmer: Somebody must.

Mr. Strauss: Indeed, no; unless the Government are going to get into the most appalling difficulties and embarrass the Foreign Secretary very greatly they will have to adopt a plan about aiding foreign parties—all or none. Let us take the question of the French democracy. There are many lawful parties in France, including the Communist Party. I say that so long as there are these lawful parties in France, transfer by bodies in this country to parties in France must be permitted for all or for none. Let us look at the criterion laid down by the right hon. Gentleman, when he says:
I would approve contributions made for the purpose of strengthening the democratic forces in any country, and I would disapprove contributions made to organisations whose activities are hostile to that purpose."—[OFFICIAL REPORT, 30th November, 1948: Vol. 458, c. 165.]
I dare say that every hon. Member would adopt the same principle if he himself were to decide what was a desirable gift. The nature of his decision would differ in different cases, so that, if there had been an application to help Signor Nenni, it would have been granted on one day but turned down two days later.
I could give many other examples. One of the transfers, which was the subject of one of the Questions mentioned by my hon. Friend, was a transfer for the benefit of striking miners in France—or for the benefit of the families of striking miners. I imagine that a man is helped if his family is helped, because I think families still exist to that extent, even in the opinion of the right hon. and learned Gentleman. The transfer was made for the benefit of the families of miners in France striking to defeat the Marshall plan. If any such transfers are to be allowed the right hon. and learned Gentleman may have been completely right to allow that one; but if some are not to be allowed, to choose to allow that particular one might well, I should have thought, embarrass the right hon. and learned Gentlemen in future negotiations with other Powers, and I am quite certain


that it will embarrass the Foreign Secretary.
Let me give another example. Suppose an individual or party in this country desired to send funds to General de Gaulle. For all I know, if this system is to continue that application may come. How would the right hon. and learned Gentleman deal with it? How would hon. Members opposite deal with it?

Mr. Scollan: Turn it down.

Mr. Strauss: I am delighted to receive an answer. The hon. Member opposite says he would turn it down. I am very glad to have a clear answer, because I am certain that helps the Chancellor of the Exchequer to realise exactly where he is leading us. Here are his back benchers saying that it is quite right for the Chancellor of the Exchequer to transfer moneys to those parties that they themselves like, or who, they imagine, rightly or wrongly, somewhat resemble themselves, but that it would be quite wrong to transfer moneys to a man considered to be extremely anti-democratic by some of them, on the ground that he was demanding a general election. Anyhow, whatever the view held about General de Gaulle, his party is perfectly legal in France.
I hope that the Chancellor of the Exchequer, when he replies, will not give a hasty answer on whether a transfer to General de Gaulle will be permitted or refused, because I think he will wish to consult his right hon. Friend the Foreign Secretary before making any answer. It is quite clear, however, that, whichever answer he gives, he will lead the Government into an extremely difficult position. My guess is that the Chancellor, thinking that he can legitimately evade an answer by this method, will say: "I will consider that question on its merits when the application is made, but I will not disclose to the House tonight, when the matter can be debated, the principles on which I shall act."
Let us look at these principles. First: "Strengthening the democratic forces in any country." Democratic in what sense? In the sense in which the word is used and has been used by political thinkers in this country? Or in the sense in which it is invariably used behind the "Iron Curtain"? Hon. Members oppo-

site, if they have taken the least interest in foreign affairs, know that there is no other word to which such opposite meanings are attached in different parts of the world. In fact, I think, a principal cause of some of the difficulties in which the world finds itself is that in so many conferences on international affairs, when great differences have appeared between parties, instead of trying to resolve those difficulties, or to admit a difference, people have got down to the matter of finding a formula; that is to say, thinking out a form of words to which each party, to the knowledge of the other, attaches an opposite meaning, so that by subscribing to them they can pretend to agree while in fact continuing their quarrel. That is the method followed in agreement after agreement between countries like ourselves and those countries behind the "Iron Curtain" where the words "democratic elections" have been used and each party has attached an opposite meaning to them. By "democratic elections," we mean elections where the candidates of all parties are allowed to stand and the electors can decide between them, but the countries behind the "Iron Curtain" mean elections in which only the Communists are allowed to take part, or those who have been agreed with the Communists beforehand.
I wonder in what sense the right hon. and learned Gentleman was using the word "democratic" in the answer I have quoted to the House. I wonder whether he really thinks it right himself to decide, without any possibility of review, except, perhaps, that we could move a reduction in his salary if it were thought that he had not acted in a bona fide manner. I wonder whether he really thinks that to be a very satisfactory position, and does not think the better course would be to acknowledge that he has made a mistake. Whatever may be our opinion of the right hon. and learned Gentleman, we all know that he works extremely hard, and for a man working so hard it is not dishonourable occasionally to make a blunder; if so, let him acknowledge that it is a blunder, and let him put the thing right.
My hon. Friend asked about publicity. I wonder what parties, if any, have been helped in Germany.

Major Bruce: Before the war?

Mr. Strauss: I am assuming that the hon. and gallant Member is able to think. He will realise that this question can arise only since the exchange control arrangements have been in force. That is the subject of the Debate. I have never transferred any money to a political party abroad, and I have not the slightest intention of doing so. I am putting forward what I believe to be a serious argument, the argument that, apart altogether from the question of tyranny and interference with people's wishes, this is calculated to cause the greatest international tension and misunderstanding, if the right hon. and learned Gentleman is entitled at his own whim to decide which parties he will allow to receive these transfers and which parties he will forbid. I asked on another occasion whether Communist sympathies were required in either the giver or the recipient, or both. I got no answer, but I received the intimation from the right hon. and learned Gentleman's colleague to put that Question down. Why does the right hon. and learned Gentleman persist in a course of action that is obviously unwise, that is resented by persons of all parties, that cannot be justified, that will embarrass the Foreign Secretary, will lead the Government into difficulties and has nothing whatever to commend it?

8.45 p.m.

Mr. Emrys Hughes: I wish to deal with this matter from the point of view of the gift made by Scottish miners to the wives and children of French miners who went on strike. It has been said that this gift was made to Communist strike funds, and two opinions have been adduced in support of that—one. by the hon. Member for Orpington (Sir W. Smithers) who said, "Up the Reds" and the other by the "Glasgow Herald," the well-known anti-Socialist and anti-Communist paper. If the gift of the Scottish miners had been for Communist Party funds or Communist purposes I think the hon. Member for Farnham (Mr. Nicholson) would have been entitled to object. Indeed, I have always been opposed to the Communist Party and I, too, would have protested if this money had been for the Communist Party funds. But the object of this gift was to help the wives and children of French miners who were on strike. I was glad the Chancellor did not treat

this matter as being another Communist stunt, but acted humanely and intelligently in deciding that the gift of the Scottish miners could justifiably be allowed.
I remember when the hon. Member for Farnham pleaded for necessitous people in India. I agreed with him that the starving women and children of that country should be treated considerately by people here. The £1,000 gift of the Scottish miners was to help fellow human beings who were suffering from hunger and distress. There is not a scrap of evidence that the money was handed over to Communist Party funds. The Communist Party does not need gifts of £1,000 for their organisation in France, or any where else——

Mr. H. Strauss: The "Daily Worker" does.

Mr. Hughes: The hon. Member for Farnham has been actuated by prejudice in this matter, instead of dealing with it on its merits. Scottish miners have frequently made gifts of this kind. I would have no objection if they sent similar gifts to workers who were suffering in any other part of the world. Because miners on strike happen to be members of the Communist Party I see no reason why their wives and children should starve. I remember when our own miners and their families were helped by money gifts from the U.S.S.R. We should stand by the honourable tradition of this country that suffering people anywhere are entitled to humane consideration. This question should not be exploited purely for partisan motives.

Mr. Nicholson: I honour and respect the Scottish miners for their motive, but my point is that it should not be left to the Chancellor, or any Government Department, to decide on political grounds whether certain gifts should be made or not. I said it was inconsistent on the Chancellor's part to allow the money to go to so-called democratic forces and, from there, to the Communist Party.

Mr. Hughes: I am dealing with the particular case of the Scottish miners on its merits. It was due to humanitarian motives that permission was given by the Chancellor of the Exchequer for this money to be sent, just as humanitarian


motives were adduced by hon. Members as the reason for supporting the starving Indians.

8.50 p.m.

Mr. Baker White: I want to deal with the particular point raised by the hon. Member for South Ayrshire (Mr. Emrys Hughes)—the question of this donation of £1,000 from the Scottish miners to France. I readily admit that this donation was made with every sincerity. I am not influenced by the fact that Mr. Abe Moffatt, the President of the Scottish Miners, is a member of the Executive of the Communist Party of Great Britain. I am not influenced by the fact that several members of the Executive are also members of the Communist Party.
Permission was given by the Chancellor of the Exchequer for the transfer of the sum on the grounds that it would be used to relieve distress amongst the dependants of French miners, distress arising from the conditions of the strike in which they were then engaged. I have only normal channels through which I can make inquiries, but I ask the right hon. and learned Gentleman to make the same inquiries as I did through the normal diplomatic channels to the French Minister of the Interior, M. Moch, and see whether he gets the same answers as I did.
What happened to the £1,000? The background of the story is that the strike was organised by the C.G.T., which is a Communist-dominated body. Last December or January the C.G.T. organised a number of strikes and reduced itself to a state of penury with the result that it had a heavy overdraft on the bank. Both the C.G.T. and the Communist Party of France bank with the Banque Commerciale de l'Europe du Nord. Of the 100,000 shares of that bank 99,700 are held by two Soviet banks. The chairman is a naturalised Frenchman of Russian birth. The Communist Party of France has at that bank a heavy and long standing overdraft. The Communist Party Press overdraft rose from 17 million francs in June to 30 million francs in October. The Communist Party of France has two private accounts at that bank, one in the name of Oswald and the other in the name of Gusmar.
It was into that bank that the £1,000 donated by the Scottish miners, was paid,

and my information is that the £1,000 was used not for purposes of relief but to reduce the overdraft of the G.G.T. The right hon. and learned Gentleman has official channels through which to make his inquiries. There was a somewhat peculiar donation which was held to come from the Czechoslovak miners. It was a very considerable one. It was equal to one month's pay of every miner in Czechoslovakia. There was another donation which did not reach France. That was in gold carried in his pockets by a Roumanian who was stopped at the frontier by the Sureté.
My information is that, however sincere may have been the motives, that money from the Scottish miners was not used for the purpose for which it was donated, and I venture to suggest that when donations are made from this country to Communist-dominated organisations the right hon. and learned Gentleman should scrutinise them with greater care. My last word is this: I wonder what hon. Members opposite would have said if the Conservative Party had wished to donate £5,000 to a Right Wing body in Europe?

8.55 p.m.

Mr. Carmichael: I want to take up the point about the Scottish miners. The hon. Member for Canterbury (Mr. Baker White) has deliberately shifted his ground. His objection was that the miners made a donation. In the beginning he said he had no interest in the Scottish Miners' Executive, yet he took pains to advise us that a number of its members were members of the Communist Party. The principle adopted by the Scottish miners is one that is well established in this country, and it is that of going to the aid of women and children when men are on strike. The principle is well established with Governments and even with local authorities. No matter what the conditions of a strike are, and no matter what the conduct of the strikers, we always go to the aid of their women and children. Public assistance authorities do so all over the country, even if the strike be regarded by most people as unconstitutional and dangerous to the country. I say, having no sympathy with the Communist Party, but knowing the Scottish miners, that they were prompted


to make the donation because of the desire to aid the women and children of the people in France.

Mr. Baker White: I thought I made it clear that I was not disputing the motives with which the money was given and that I was not prejudiced by the fact that the Communists have a certain influence in the Scottish Miners' Executive, but that I was only interested in what happened to the money when it got there.

Mr. Carmichael: The Adjournment Debate was demanded because of the action of the Chancellor of the Exchequer in permitting people to make the donation with good motives. I am sure that the Chancellor of the Exchequer is fully alive to his responsibilities and will be able to speak for himself. I am concerned about the £1,000. Apparently had there been no control order, some hon. Members would have raised no objection. My view is that this is an attempt to salve your own consciences, because for generations you have always engaged in this method of raising money at every opportunity to aid people on the Continent of Europe, if you felt that they were sympathetic to your point of view. The only objection is to the control order.

Mr. H. Strauss: It is discrimination.

Mr. Carmichael: If I had authority I do not know that I would have attempted to discriminate between Left and Right. I do not know that I would have refused to allow the money to go. The only reason why the Conservative Party has made no open contribution to any of the bodies on the Continent of Europe is that they are too anxious to raise all the money they can so as to fight the General Election. We have evidence that they have sent any amount of money abroad in the past. You did not send your own money. You used the taxpayers' money when you intervened in Russia and spent many millions.

Mr. Deputy-Speaker (Mr. Bowles): The hon. Member ought to address the Chair without putting all those imputations upon the character of its occupant.

Mr. Carmichael: I should address the Chair, Mr. Deputy-Speaker, but the invitation was so encouraging that I could not resist it. However, I leave it at that.

The Tories are the last people to castigate anyone. It is a political move and nothing else. It is an attempt to make political capital. It is evidence of the bankruptcy of the Tory Party that this is the very best thing to which they can lay their hands. I can remember the General Strike, and some other hon. Members remember it, too, for it was the first time one or two of them took up hard work for a period. I remember that at that time the French miners sent over money to assist the wives and children of the Scottish miners. I remember that the German miners did likewise to aid the Scottish miners' wives and children. That was at a time when hon. Members on this side of the House were trying to make it very difficult for them to live.
It may be that the £1,000 was wasted in France. Maybe it was put to some ulterior use. I have no knowledge of that. All I am concerned about is that if the Chancellor was asked to make up his mind on the donation, it was right and proper that he should agree to the £1,000 going to France in order to aid the women and children there. That is the only issue which arises at this stage. I have only one regret, and that is that the miners of Scotland and the miners of Great Britain were unable to send much more to aid the French women and children at that time.
The argument is that the organisation was Communist dominated. I am getting a bit uneasy about this business of the Communist menace. We dare not raise our voices against certain people in many places now without being dubbed Communists. It may be that the Communists dominated the French trade union, but I am wise enough to know that there are certain forces at work which create a situation to bring the Communist movement to the front.
I will leave it at that and will again say that I am happy in the knowledge that the Chancellor agreed to allow the £1,000 to go to the women and children of France. Knowing the goodness of the French and German people and the common people of the world—if we were in difficulties they would send it to us—I hope that if ever such a difficulty arises again, the miners and other workers in this country will take the opportunity of sending all that


it is possible to send to aid women and children during the period when their men are fighting against what they regard as unfair conditions.

9.3 p.m.

Mr. Drayson: As the House may know, my main interest in this matter has been the past refusal of the Chancellor of the Exchequer to permit an adequate sum of money to go to France to erect a memorial to commemorate the 49th (West Riding) Division. Some weeks ago when we heard that £1,000 had been permitted to go to the striking miners in France I asked the Chancellor of the Exchequer if he would reconsider the application from the 49th Division. I was very surprised at that time that the Chancellor of the Exchequer, in spite of the action he had taken with the striking miners, was not prepared to give way.
A lot has been heard about the £1,000. I suggest that one of the influences brought to bear on the Chancellor in making this transfer of money was Mr. Arthur Horner. We all know the great influence that gentleman has with Members of the Cabinet. He is perhaps the real Minister of Fuel and Power in this country at the present time. Feeling that it was inadvisable that he should devote his skill and energies to causing a lack of output in the coal mines of this country, he thought he would go over to France and try to teach them a few lessons—[HON. MEMBERS: "Nonsense."]—about how they could disrupt Marshall Aid. It was to aid and abet him in that that the Chancellor allowed money to go to the striking miners and their families and, as has been pointed out this evening, it is highly improbable that one penny of that money has ever fulfilled the purpose for which it was intended. The Chancellor may delude himself, but he does not delude the people of this country when he makes the excuse in this House that it was to go over for charitable purposes. Of course, we learned later to the further amazement of the House that this £1,000 was not the only sum involved, but that £5,000 or £6,000 had been permitted to go to help the finances of a tottering Socialist newspaper.
We know that as far as the various war memorials are concerned, both the 49th Division and the 15th Scottish, the

Chancellor has given way. Bearing in mind the rising national indignation on this matter, about which the Chancellor smiles, he was wise to do so. If he had seen some of the letters I have received from all over the country from veterans of the 1914–18 war, as well as from those who fought in Scottish and North country Divisions during this last conflict, he would have changed his mind much earlier. It was said in those letters that the Chancellor of the Exchequer is completely out of touch with the feelings of the working-class people in this country at the present time. Words were used about him which it would be quite unparliamentary for me to repeat in this House tonight.

Mr. Carmichael: That is one of the workers.

Mr. Drayson: With regard to the principle behind this matter, who is the Chancellor of the Exchequer to judge what are the forces most calculated to strengthen democracy in foreign countries? As many hon. Members have said, this is not a question which the Chancellor of the Exchequer, who is politically minded, should be called upon to decide.
There is one other point in connection with the memorial, which I put in a supplementary question to the Financial Secretary to the Treasury. I asked him if it was not monstrous that this money should have been allowed to go abroad to finance political parties, and he gave no reply. Evidently, however, the Chancellor disagrees with his Financial Secretary, because he has thought better of it and has allowed the money to go.

9.9 p.m.

Mr. Scollan: This is one of the most astounding Debates I have heard in the House since I came here. It is almost impossible to make up one's mind, after listening to the Opposition, whether the three hon. Members who have taken three different courses knew exactly why they were opposing this gift. [An HON. MEMBER: "Which gift?"] The gift from the Scottish miners to the starving women and children during the economic dispute in France. That is the gift.
One hon. Member definitely let the House know that he was against the


giving of this money, irrespective of whether the Chancellor had power to control its going to France. The hon. and learned Gentleman the junior Member for the Combined English Universities (Mr. H. Strauss) let the cat out of the bag. He was not concerned at all about the gift, the source from which it came or where it went. What he was concerned about was the control. He wanted the exchange control removed.

Mr. H. Strauss: Mr. H. Strauss rose——

Mr. Scollan: Oh, yes, he did. We can read it tomorrow. He definitely made it plain that what he was against was the exchange control.

Mr. H. Strauss: Will the hon. Member permit me? I cannot think that he wishes to misrepresent me. I said that the problem arose on account of exchange control; that as long as we had exchange control these remittances must be governed by absolute rules; and that, if they were allowed to lawful political parties, they must be allowed to all or allowed to none.

Mr. Scollan: If the hon. and learned Member reads tomorrow's HANSARD he will see that, over and above what he has repeated, he said that there should be no hindrance for any section of the community here to transfer money to anybody abroad. Consequently, that means the removal of exchange control. He cannot retract from that.
Another hon. Member, on the other hand, opposed the sending of the gift from an entirely different angle. He was opposed to it, not because of the motives of the miners who sent the money, but because, according to a story he had received—I do not know whether at first hand or second hand—it was used for an entirely different purpose at the other end. So we have had three hon. Members opposite opposing the motives of the gift from the Scottish miners.
Let us take the first. I do not understand why an hon. Member should have the temerity to stand up and say he was opposed to its going, irrespective of need or anything else, for the simple reason that never in the whole industrial history of mining in Europe has there been a dispute of any kind without some political motive being attributed to the leaders of

the dispute by the owners of the industry for the purpose of trying to discredit the leaders amongst the men. That has happened for the last 100 years, not only here, but in France, in Germany and in every other country.
There may be a higher percentage of Communists amongst the miners in France than in Scotland. I do not know, but one thing I do know is that even that high percentage cannot bring out the whole industry unless the men have a real grievance. Everybody knows that the financial system in France was in such a parlous condition that one week's wages were practically worthless the following week.
The reason why the hon. and learned Member for the Combined English Universities wants exchange control removed does not concern the £1,000 at all. He had better "come clean" about it. For the last two years have not the Opposition been harping on the right to get more money out of this country and into Europe and other foreign countries? If any country has any complaint about its being kept and frozen here it is America more than anybody else. If money had been allowed to go out of the country, and if the control had been taken off as hon. Members opposite wish, our paper money would have been as worthless as that of some other parts of the world. As a result the Labour Government would have been brought down, chaos would have arisen and our whole economic system would have been wrecked. What do the Opposition think they would have gained? I want to assure them they would have gained nothing. As a matter of fact, they were treading on very dangerous ground. In that way one can bring a nation to revolution, which is the one thing they do not want. The Opposition ought to be very grateful to hon. Members on this side of the House, for we have established that they can go to bed and rest content. Their property and bank books are quite safe. People on this side of the House go to the workers and say, "You must not go in for any revolutionary stuff. We will educate these people in the course of time to see the error of their ways." The hon. and learned Member for the Combined English Universities must not take it too seriously.
Everyone hoped that the £1,000 would go to the women and children in the


dispute. Someone has discovered a mare's nest and that it did not go there but to the C.G.T. and that the C.G.T. have three banking accounts. When the hon. and learned Member was addressing the House about banking accounts, I had the feeling that we were over at Church House. It sounded extremely like it. I wonder if any subscriptions came from abroad to Lord Woolton's Fund? A prominent figure gets up and says, "I want £1 million by subscription" and that is a tidy sum, but when Scottish miners send £1,000 to miners' women and children in France, everyone can read by whom and when it was subscribed. I wonder if the party opposite will publish an account and tell us who paid subscriptions to Lord Woolton's Fund?

Mr. Kirkwood: You have paralysed them.

Mr. Scollan: This House ought to be big enough to give their blessing to the miners and to the Scottish miners especially—the English miners did not send anything, by the way. The matter came before the Chancellor, who is now condemned because he allowed the money to go. Suppose the Chancellor had said that the money was not to go, hon. Members might have accused him of political bias, but that is not the point. The whole of the French people, irrespective of whether they were for the strike, or against the strike, knew that this was a charitable gift to people in need. Consequently, he has earned the friendship of the French people for this country. That is a very valuable asset.

Mr. Baker White: Would it not be much more practicable to have handed £1,000 to the French Red Cross, who were already doing relief work in the coalfields?

Mr. Scollan: Obviously, if the Scottish miners said to the Chancellor, "We want to give £1,000 to the French miners," it would have been very bad if the Chancellor took it from them and gave it to the Red Cross in France. He had to decide either to send it to the people to whom the miners wanted it sent, or to refuse to send it. Taking the long view, apart from any prejudices in regard to Communist power in the French trade unions, no sensible person in France would for one moment condemn the Chancellor for allowing that money to

go. He has earned and cemented the friendship of the working class in France with the working class in Scotland.
There is another aspect of the matter. Suppose that he had refused to allow the money to be sent. Some of these days we shall have to raise the question of the Treaty of Union and the right of the Scottish people to send to whom they like. The Chancellor had better remember that when the Scots signed the Treaty of Union in 1707, they did not hand over all their powers and right to somebody else. They retained certain privileges and powers and some of these fine days they may challenge some of the things which are done by others and which they are not allowed to do. [Interruption.] I hope they will. Scotland could cut the Gordian knot tomorrow and live independently without any charity from anyone. That is more than England can say. I am not pleading Scottish nationalism. What I am saying is for the benefit of the Englishmen who do not know better. If they did, they would not indulge in these cheap sneers, which are made in ignorance and nothing else. In this matter, the Scottish miners plus the Chancellor of the Exchequer have done more to cement friendship with France than anything which has been done in the last 100 years.

9.22 p.m.

Mr. Pickthorn: I do not want to speak at much length—[HON. MEMBERS: "Hear, hear"] If hon. Gentlemen cannot be polite about it I will do so. Especially I do not want to talk at great length about the gift from the Scottish miners, but I think I may properly ask one or two questions on that point. I do not think it, as many or most speakers have thought it, to he a very important part of the case, but since most or many speakers have thought it so, I think it courteous to refer to the matter.
I wish to ask one or two questions. Into which category, from the Chancellor of the Exchequer's point of view, did it come, because we have had speeches, but not all the relevant speeches, on the assumption that this was a purely charitable gift? I am quite prepared to think that it was wholly humanitarian, though, indeed not for the whole of humanity but


only for that part of humanity which is female or below grown up age—that it was a purely charitable gift for women and children. Was it upon that basis that the Chancellor of the Exchequer allowed the money to go, or was it on the basis that the C.G.T. is one of the forces—I have forgotten what were the words of the right hon. and learned Gentleman—that they were one of the democratic forces in France? I speak at the moment only of the case of the miners' gift. I wish to know in which class it was. About half the argument has been on the one assumption and half on the other. The Chancellor must know which it was. He has told us how much money has gone in the different categories. It must have been totted up for him by one of the clerks in the Treasury. Can he tell us into which category this money came? That seems to me to be a perfectly fair question and I hope that we shall get an exact answer to it. There cannot be any difficulty at all in giving the answer.
I wish to go back to some of the words used by the Chancellor himself. He said that when it came to organisations for political purposes, if there was no exchange difficulty—and I suppose by that he meant if the country of destination was a soft currency country, because, of course, there is exchange difficulty, ex hypothesi there is exchange difficulty, everywhere all the time; that is the point of exchange control. Will the Chancellor correct me if I am arguing on a false assumption? My assumption is that when he says "if there is no exchange difficulty," he means that the country of destination is a soft currency country.

The Chancellor of the Exchequer (Sir Stafford Cripps): The Chancellor of the Exchequer (Sir Stafford Cripps) indicated assent.

Mr. Pickthorn: Thank you. The next point is that the Chancellor of the Exchequer tells us that, broadly speaking, he would approve contributions for strengthening democratic forces, but would disapprove contributions for other organisations. What I want to know is what modifications or exceptions are covered by the words "broadly speaking"? This is a considered answer by the Chancellor. He says that when he is asked to allow money to go abroad he does it, he allows it to go, when it is for democratic purposes, but does not

allow it—if the Chancellor of the Exchequer continues to mutter and shake his head it really is not fair. The words of his which I am using are words which were considered words, and he is going to have a full opportunity to answer tonight, and it is not fair for him to indicate dissent in that sort of way unless he will correct. He certainly does say that he does approve of contributions for the purpose of strengthening democratic forces and "would disapprove"—which might be taken to mean he has never as yet disapproved but would—and I would like him to answer that question—has he yet disapproved suggested contributions for political purposes, because they were the wrong political purposes? Does "would" mean that? I think again that that is a perfectly clear matter, and the answer must be simple, and I think that the House is entitled to the answer.
I come again to the Chancellor's words yesterday. He began by saying:
I accept full personal responsibility for all decisions taken by the Treasury."—[OFFICIAL REPORT, 7th December, 1948; Vol. 459, c. 270.]
I should like him to tell us what that means. He is the Chancellor of the Exchequer: that is only a short way of saying that he is the man who, parliamentarily speaking, has full responsibility for what happens in the Treasury. I cannot understand what he means by saying that he accepts full personal responsibility. Again these are considered words. By saying that he accepts full personal responsibility he, in fact, rather tends to whittle down his responsibility—[Interruption]—oh yes, certainly, because the implication—and if hon. Gentlemen will read the supplementary questions and answers they will see that the implication was emphasised—the implication quite definitely is that whoever has done it he must take the responsibility.
This is a matter where the Cabinet is entitled to know how it is managed and how the decision is taken. Are instructions given to Treasury clerks—the right hon. Gentleman tells us it was a matter of ordinary administrative routine "in the ordinary course of administration some cases may be decided in one way and some in another," that might mean that some cases may be decided "Yes" and some "No." Obviously, I should


think, it did not mean that. The only other thing it could mean is that some cases may be decided by one Treasury clerk and some cases by another. The question I wish to put is this. What precautions are taken to ensure that either or both of them have the same degree of information about these matters as is contained in the Foreign Office? Because if it were constitutionally proper that any Minister should use the administration of exchange control for political purposes, if it were possible that any Minister should take personal responsibility for that, I cannot see how it could be the Chancellor. It seems to me that it would clearly be the Foreign Secretary's business.
I think that the questions which I have put are peculiarly plain. I do not think there can be any difficulty about answering any of them, and I hope that we may have an answer to them.

9.29 p.m.

Major Bruce: The burden of the case of the Opposition, as I have heard it, seems to be that my right hon. and learned Friend, in exercising his power under an Act which was already on the Statute Book when this Government came into office, has exercised unfair discrimination in permitting a sum to be sent abroad which was subscribed from private sources and was intended for specified sources at the other end. That has been the burden of the Opposition's case this evening. The first thing I would say is that I do not think it lies in the mouth of the Opposition to make any case of, or even to mention in this House the word, "discrimination." I do not want to go too far back into history because very often it is a little embarrassing to right hon. Gentlemen opposite, but I should like to give an instance in which the Conservative administration did possess certain powers which entitled it, if it desired, to make discriminatory decisions. Within a fortnight of the beginning of the last war, 40,000 tons of steel left the Port of London for the Port of Hamburg. At the same time, it was forbidden to send potatoes into Republican Spain. If that was not discrimination, I do not know what is.
What the Opposition do not seem to understand is that to aid suffering anywhere in the world where we have the

power to exert our influence is in itself to aid the forces of democracy. That is the first thing which, I think, they do not understand. I say straight away that if the Tory-sponsored British Housewives' League wished to send money abroad to distressed families of Junkers in Germany affected by the Currency Reform, who are in definite need of it, half-starved and in dire distress, I should be the first to support the right of the British Housewives' League to send that money abroad to relieve distress on the part of a specific body. However, I do not think that is likely to happen. I should have thought that the best safeguard in all these matters today is that in fact they are not secret——

Mr. Nicholson: They are secret.

Major Bruce: In this country the accounts of the trade union movement and the accounts of the Labour Party are made public. There is no secret at all about the transfer of any sums anywhere by the Labour Party and the trade union movement. What do we find about the Conservative Party? I am not suggesting that the Conservative Party itself would wish to send any funds abroad—it has other uses for them here but for the party opposite, which covers its accounts in a shroud of mystery, to accuse the Government of exercising any secret discrimination is, I think, about the last word in absurdity.

Mr. Nicholson: Does not the hon. Gentleman realise that we are not just referring to contributions of the Labour Party but to anyone who applies to send funds for public purposes abroad? We say that is shrouded in secrecy, and that it should not be.

Major Bruce: I have made my position quite clear to the House. I repeat again that if the Tory-sponsored Housewives' League wish to send a sum of money abroad to relieve genuine suffering and distress I, for my part, would be perfectly willing to support that effort. I see that hon. Gentlemen opposite merely regard that possibility as academic, and I can quite see why, because, of course, these matters have never attracted the support of hon. Members opposite anyway. I repeat that I do not think there is anything in the least bit sinister in this, and if there is made to my right hon. and learned Friend, within the


exercise of the powers which he already possesses, an application for the transfer of funds abroad from a bona fide source here to a bona fide destination at the other end, I cannot think why it should not be left to his discrimination, always bearing in mind that he is likely to have to account to the House, as he is now doing in this case.

9.35 p.m.

Mr. Lipson: I am glad that the Chancellor has changed his mind with regard to the war memorial. I think that his decision was wrong in the first instance, and I am glad that he is big enough to have realised his mistake and to have changed his mind. I am also glad that he agreed that the £1,000 should go to relieve the distress caused to strikers' wives and children; but as he gave his permission for that money to go for charitable purposes he has a certain responsibility, in view of the allegations made in the Debate, to find out from those who sponsored the gift whether it was used for the purpose for which it was intended. I do not know whether he has taken steps to find out whether the money was devoted to relieving the distress of the wives and children, but I should be glad if, in replying, he would say that he is prepared to take up this particular question with the Scottish Miners' Federation.
It is also a fact that money has been sent to political parties in France, and to certain French newspapers. Personally, I think it is a great pity that citizens of one country should interfere in the politics of other countries to the extent of subsidising political parties or political newspapers. It is one of the things about which we complain with regard to Russia and the International Communist Party. If we in this country sanction that in any form, in the sacred name of democracy, in which we believe, then it is quite illogical for us to turn to any Communist country and say, "It is wrong for you to subsidise Communist Parties in countries other than your own." We must at least give the Communists credit for being as sincere about their Communism as we are about our democracy. Therefore, I hope that one result of this Debate will be that in future we shall hesitate before continuing along that very dangerous path, which I

believe to be one of the contributory causes of the disturbed state of the world today.

9.37 p.m.

Mr. Benn Levy: I had not intended to take part in this Debate, but as I listened to the arguments of hon. Members opposite I felt constrained to lend for a few minutes my support to their efforts to demonstrate that they really have not the vestige of a case.
The hon. Member for Farnham (Mr. Nicholson) opened the batting. Everybody likes him. We recognise in him, if I may quote his leader's phrase, a certain honest simplicity. However, the fact that he has lent himself, as the spearhead, to this petty and foolish attempt on painfully partisan lines to discredit the Government is an indication only of the danger, even to people such as him self, of keeping bad company. [Laughter.] Nobody will doubt what is in the mind of the hon. Member for Flint (Mr. Birch), a fact which reveals, unfortunately, a certain familiarity with the mind of the hon. Member.
The argument advanced by the hon. Member for Farnham was that this action of the Chancellor's was counter to all historical British tradition, which was completely against the practice of discriminating; and that this country never discriminated in connection with the political affairs of other countries. When my hon. Friend the Member for Stoke (Mr. Ellis Smith) recalled one historical precedent to the contrary, namely, the funds sent to the Royalists during the French Revolution, he was met with a certain amount of shallow laughter. But there are more recent cases. When my hon. Friend the Member for Eccles (Mr. Proctor) cited the case of Greece, which so far has provoked no dissent or criticism from hon. Members opposite——

Mr. Nicholson: Of course it has.

Mr. Levy: I am delighted and astonished to hear that Members opposite have been protesting that British funds should have gone to help one side in the dispute in Greece. It is novel to me.

Mr. Mott-Radclyffe: The hon. Member must have been listening to the Debate. He must know it was


pointed out from this side that in the case of financial assistance to Greece the sending of funds from this country by the Government was debated two years running in this House on the Foreign Office Estimates, and that the transfer of funds for political purposes, which we are now discussing, would never have come to light but for Parliamentary Questions.

Mr. Levy: I am perfectly aware that the sending of funds to Greece was debated and was agreed to, but the fact that it was agreed to and the funds were sent, contradicts the proposition put forward by Members opposite, namely, that funds were never sent to one side or another in any other country. That was answered by the argument that we were sending them to a Government, while presumably the opposition were all rebels. That I could accept, but this did not prevent us sending funds to rebels against a Government in 1921–22 in Russia. Members opposite cannot have it both ways.
A more serious argument was advanced, mainly by the hon. and learned Member for the Combined English Universities (Mr. H. Strauss), who was echoed, substantially, in his pedantic little way by the hon. Member for Cambridge University (Mr. Pickthorn). That argument took exception to the statement by my right hon. and learned Friend that the funds were being confined to democratic purposes. I have waited for and have not heard any reason why on earth that is a bad principle. Am I to understand that Members opposite support the sending of funds abroad for anti-democratic purposes? If there is anyone who secretly hankers after that, let him get up and declare it now.

Mr. Drayson: They are all on the Government side.

Mr. Levy: I heard no dissent from my side, nor was the Chancellor's statement criticised on our side. The only argument in this connection raised by Members opposite was that it has become extremely difficult to know what the word "democratic" means. I entirely agree with the hon. and learned Member that it has been a part of Communist Party policy to appropriate the word "democratic" and thus to debase its meaning, just as Members opposite have similarly

attempted of late to appropriate and thus to debase the word "freedom," These valuable and fundamental concepts can easily be perverted, but it is surely perfectly reasonable for my right hon. and learned Friend to say that what we, the House, consider to be democratic purposes shall be the criterion.
The hon. and learned Gentleman seemed to be asking for an iron-clad uniformity, but with these kinds of regulations there can never be an absolute iron-clad uniformity, any more than in such matters as granting compassionate leave. Individual cases must be judged on their merits. It is quite puerile for the hon. and learned Member to imagine that by anticipating that that would be the Chancellor's reply, he could forestall it. That must be his reply. The uniformity of treatment must be modified by a certain amount of latitude for the granting of exceptions, and that is precisely what has happened here. As has been said already tonight, this Debate is really no more than a demonstration by the Opposition of how hard put to it they are to find a stick with which to beat the Government.

9.46 p.m.

Mr. Oliver Stanley: I always listen with pleasure and some internal questioning to the speeches of the hon. Member for Eton and Slough (Mr. Levy), with half of whose constituency I was once connected. Curiously enough, I have heard the hon. Member only in his capacity as a legislator; I have never heard him elsewhere in his other artistic activity. Whenever I listen to him in this House I always wonder, first, when it is that I shall ever be granted the opportunity of listening to him in another capacity elsewhere and then I think that even should that opportunity be given to me, I shall never in future, as I never have in the past, take advantage of it I could only think that this evening the hon. Member was playing in the House a part of a play which he had in contemplation for the future.
In this Debate we have roamed over a very wide field. One hon. Member referred to the Act of Union of 1707, and the question of the French Royalists at the time of the French Revolution was raised. I want to return to the very short and simple point which is the main purpose of this Debate. Much has been said


about the gift of £1,000 to French miners I, personally, am not so much concerned with that particular part of the case as with the other, with which I shall deal later. As I understand the matter, that gift was permitted by the Chancellor on the ground that it was a charitable donation, and that he was in the habit of limiting the amount of charitable donations of that kind to a certain quota.
I agree with the hon. Member for Cheltenham (Mr. Lipson) that the real cause of complaint, if there is any there, is what steps the Chancellor has taken to see that the money he permitted to be transferred as a charitable gift was, in fact, devoted to that purpose? I do not think it enough that the intention of the donor at this end should be charitable; I think it is the duty of the Chancellor also to satisfy himself that the intention of the donee in the use of that money is according to the principles which he laid down.

Mr. Mitchison: Is there not some practical difficulty in ensuring that gifts sent abroad for charitable purposes are applied, when they are under the control of a foreign Government, for those purposes?

Mr. Stanley: I should not have thought it would have been difficult in this case for the Chancellor, working closely, as he must have been, with the French Government, to ensure that this money was expended in the way in which the miners who subscribed towards it intended, and for the purpose for which he permitted the gift to be made.
Part of the case to which I want to draw attention, because as I understand that was the part which gave rise to this Debate on the Adjournment, is that which deals not with the subscription to the French miners, which was granted on charitable grounds, but the subscriptions to the other two French organisations, one a paper and the other a trade union, which was approved by the right hon. and learned Gentleman on political grounds. Of course, it is quite plain that the whole of the difficulty in this case arose because of exchange control. If there had been no exchange control no complaints could have been made with regard to these donations approved by the Chancellor of the Exchequer, or with regard to other donations which either have been or

might have been disapproved of by him. In passing, I take it he would not allow a transfer from the Communist Party in this country to the Communist Party in France, but before exchange control that would have been perfectly legal and no exception could have been taken to it.
Therefore, all the talk of what was done in the past, whether at the time of the French Revolution or the Union with Scotland, is really irrelevant. I freely admit it was and has been for a long time the custom of associations in this country of one kind or another to subscribe in particular circumstances or in particular cases to similar organisations having similar objectives in other countries. There has never been anything wrong about it.
Now we get the new situation of exchange control, and, if my recollection serves me, at the time when the Measure was passed by this Government to take the place of the control which, during the war, was exercised by regulation, we admitted that it was still necessary to have exchange control. We did point out at the time, however, that exchange control might impose a very considerable amount of hardship upon people. It is something which has got to be worked with great patience and tolerance, and above all it has got to be worked without any suspicion whatever of discrimination. Everybody must feel, when his application is turned down, that it has nothing to do with him personally, or with his opinions, or with the man to whom he happened to go to make the application, but that it is in accordance with a rule which is not varied on the ground of privilege or anything else.
It seems to me that as soon as the Chancellor of the Exchequer laid down his principle with regard to permitting these transfers for political purposes, he inevitably tended towards discrimination. When he says, "I am not going to allow this to be transferred," or, "I am going to allow it," discrimination must, in fact, occur. The right hon. and learned Gentleman would admit that. I do not mean discrimination in a bad sense, for I am sure he would try his best to be fair, but what he thinks fair is what somebody else with all sincerity would think most unfair. The right hon. and learned Gentleman presumably would refuse the Communist Party leave to transfer


money to the Communist party elsewhere. He would say that it was because they were not assisting democracy; but hon. Members behind him would say, on the contrary, that they are the people who are really assisting democracy, and, therefore, are the people who should first be entitled to this benefit. Equally, on the other side, an hon. Friend of mine asked what would happen if an application were made to subscribe to the party of General de Gaulle. The immediate answer by the hon. Member for Western Renfrew (Mr. Scollan) was that, of course, it would be stopped.

Mr. Scollan: Well, I hope so.

Mr. Stanley: That shows. I do not know what the present Chancellor would do, but if the hon. Member for Western Renfrew were Chancellor of the Exchequer, we know that he would stop it.

Mr. Scollan: General de Gaulle is not starving.

Mr. Stanley: I am talking now—the hon. Member must try to follow the argument—about the political case and not about the charitable case. It is true that General de Gaulle may not be starving, nor was Le Populaire and Force Ouvrière. We see at once the difficulties into which we get. Whether or not permission is to be given to send money to de Gaulle and his party depends entirely upon the personal opinion of the one who has to decide. Some would say that, in the long run, General de Gaulle is the best bulwark in France against Communism. Others would say that he is undemocratic and, therefore, is not entitled to assistance.
The same is true with regard to Communists. What would happen if an application had been made by a considerable number of hon. Members opposite who sympathise with him to send money to the help of Signor Nenni? They said, in fact, that he was standing strongly for democracy, although the right hon. and learned Gentleman had accused him of standing with the Communists, and, presumably, against democracy. I am only citing these in- stances to show how, once we get away from some purely objective test, the decision depends upon the point of view of the one particular man who gives the authority.
That brings me to the second point. In this sort of case, when the decision depends just upon the opinion of one man, who is the one man who gives the decision? The Chancellor said that he takes responsibility for all the decisions, and quite properly so. In fact, he does, but he did not say that he took all the decisions. Reading his answer, I thought it was clear that some decisions had been taken without reference to him at all. In other words, some unknown person, not the Chancellor of the Exchequer, may be called upon to give his opinion as to whether Signor Nenni is a democrat or not and whether General de Gaulle is a democrat or not. He may be called upon to give an opinion whether some well-known "fellow traveller" in this country is to be regarded as a true democrat.
I believe this position to be thoroughly bad for the proper administration of exchange control. It is submitting that administration to a quite unnecessary strain and suspicion. I suggest that it would be far better—I am dealing solely with the case of these political decisions —to say firmly, either that we shall allow permission to all, or that we shall not allow it to any. It may not really matter very much which we do. The hon. Member for Eccles (Mr. Proctor) said that if this were stopped, it might be the end of this country and that it might lead to the death of democracy. If democracy is going to die because we may not send a total of £6,000 to Socialist parties in France, I am afraid that democracy is hardly worth keeping alive——

It being Ten o'Clock, the Motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Snow.]

Mr. Stanley: That really is sheer hyperbole. Democracy is neither going to be saved by the gift of these sums nor will it be killed by their absence. There is, therefore, a great deal to be said for saying that if there is exchange control, if people are not allowed to send money freely, if even charities have to be cut down and if personal conveniences have always to be over-ruled, we should have the rule that


no subscription should be made to political parties of any kind. I, personally, think that would be best; but the other alternative is to say that, subject to some financial restrictions dictated by the state of our exchange at the time and the availability of francs, all parties might send money as and when they wanted to. Just as I do not think that the stopping of the sending of funds to democratic parties would be likely to influence the future fate of democracy, so I do not think that allowing the Communist Party in this country to send a limited sum of money to the Communist Party in France will mean the victory of Communism in that country.
Either of those two things—permits for all or permits for none—would be fair, and demonstrably fair. There would then be none of this necessity for an application of a personal test, a test that only exists in the mind of the man who has to apply it. I most strongly urge that, for the sake of the acceptance of and acquiescence in all the stringencies and harships of exchange control, and for the sake of doing away with any possible chance of discrimination between one citizen and another or one set of citizens and another, the right hon. and learned Gentleman should tell us tonight that he intends in future to adopt either one or the other of those alternatives which alone I believe to be fair.

10.3 p.m.

The Chancellor of the Exchequer (Sir Stafford Cripps): I am extremely glad that we have had the opportunity of this Debate, and that it has not been curtailed as Debates on the Adjournment so often are, because it is a matter which is of great interest and it is also a matter which is of considerable difficulty. I would like, in the first place, just to say one or two general words on exchange control. Exchange control, of course, is operated under the Act of 1947, which expressly gave to the Treasury the power to decide, not on a given set of reasons or on a given set of cases but absolutely freely as regards any case in their own discretion, whether or not exchange should be permitted for that particular purpose. Of course, it has been necessary, as a result of that, gradually to work out a whole series of rules by which this discretion is to be applied.
The great mass of cases pass through the banks and go to the Bank of England and never come anywhere near the Treasury at all—99 per cent. of them probably, or something of that kind. They are just the ordinary business deals, and everything else of that kind, which go through automatically within certain types of case. However, there are, of course, always the border line cases. A good illustration of the way border line cases arise is the different views which have been expressed in this House tonight as regards the Scottish miners' case. Some people have referred to it as a political case and others as a charitable case. I will deal with it later. Quite obviously, we get in any of these sorts of applications a fairly large field of border line cases as to which individual decision must be given.
That is the only way in which they can be decided, and I am most unfortunate in that I am the person responsible for giving that individual decision. I should have been happy if the House had put the onus on somebody else, but they did not; they put it on the Chancellor of the Exchequer and, since qui tacit per affirm tacit per se. for everything that is done in individual cases or in any other cases I take, and must take, responsibility. It is quite obvious, on the other hand, that every single case I cannot decide myself; if I did, I should be able to do very little of the other business of my office. Therefore, it is only when in the ordinary course of administration cases which are regarded as difficult cases come before those who deal with them normally that they bring them up to me; and so I deal with the margin of the difficult cases that occur. The House can imagine that some of those that have to be decided are marginal, and most difficult, cases.
Broadly speaking, individuals—individuals apart from business transactions—are only allowed to make remitances abroad in personal hardship cases, that is to say, only to close relatives if they are ill or if they want to travel for some special reason; or they may be entitled to make a monthly remittance in certain cases where a person abroad is particularly dependent and unable to move, and so on. Of course, every one of those is a case that has to be judged on the hardship involved. One cannot lay down


a rule as to what hardship is; one can only deal with it on the case as it arises. There is a mass of medical cases, and for that purpose there is a medical tribunal to which these cases are referred to decide whether a particular kind of illness can be cured in this country, or whether that person must go to a certain country, and matters of that kind. All the way through, however, it is essentially a matter of discretion once one gets outside the ordinary procedure.
The next type of case is the charitable organisation. The House knows that before the war and, indeed, to some extent during the war, there was a mass of charitable organisations in this country which remitted money all over the world, particularly in the case of the medical missions and other such bodies. Something had to be done as regards regulating what they should be allowed to transmit in future. In many cases the demands were greater than they had ever been before the war and yet in many cases—hard currency cases and others—it was obviously necessary to make some regulation. What we did there was to give them a ration. The ordinary charity had a ration and if some new charity started up, they received a new ration just as in many other rationed matters and commodities.
We have had since then to make a distinction between hard currency cases and soft currency cases because we were able to do more for the soft currency cases than in the hard, and we did not want to keep them all back at the rate of the hard currency possibilities when it was not necessary as regards the soft currency countries. Here again there were special cases also, very much borderline cases, of charitable transactions by non-charitable organisations. The Scottish miners are a typical case—people who have been accustomed to send moneys abroad for certain kinds of charitable purposes in the past but who are not regular charities and organised as such. Those cases have to be dealt with, each one on its merits, to see whether it is properly within the definition of a charitable gift, and whether it is something which can be remitted to the country in question in view of the hardness or the softness of the currency in that country.
The matter of the Scottish miners was considered. As I said in reply to the original Question about this matter, I had an assurance of the purpose for which it was required. The application is described as being:
for the purpose of purchasing food and clothing for the miners and their dependants.
On that understanding, that the gift was for bona fide charitable purposes, I decided to allow it. So there was no question, as the hon. Member for Cambridge University (Mr. Pickthorn) will see, as to the purpose of the allowance.

Mr. Pickthorn: Was it only for women and children?

Sir S. Cripps: It was described as being for the miners and their wives and families, for the purely charitable purposes of supplying clothing and food. This being a custom of long standing amongst miners I decided it would be wrong, in the case of a very soft currency country like France, to refuse permission. As a result I granted it and I think that most hon. Members will agree that that was the right thing to do.
The next question raised by the right hon. Gentleman is a very difficult one: how am I to assure that it gets to the right donees? As regards these charitable organisations, it is quite impossible ever to be assured of that at all. All I can do is to take their word for the purpose they mention and give them the power to transmit. I do not know to whom they transmit. How am I to ascertain, for instance, whether money transmitted to a mission in China is really used for the propagation of the Gospel? It is quite impossible for me to do so. I cannot follow these things. I must take the word of the transmitting authority. If I find subsequently that they have deceived me, that is a very good reason for stopping any further transmissions. But I cannot investigate all these cases, which run into hundreds, and even thousands. We could not possibly start investigating in Central Africa or, indeed, all over the world, the purposes for which they were being used. Although it would be nice to be able to check up these cases, it is not a practical form of procedure.
Now we come to the most difficult case of all, that of political organisations or trade unions. All these are spoken of


as if they were political organisations. There was only one application by a political organisation. It was sent not to a political organisation, but to some company which ran a paper in Paris. The other was from a trade union as a loan to another trade union and was not necessarily political at all. Those sorts of cases are obviously ones of great difficulty and it is quite clear that, whatever is done about them, one must arrive at a political decision. I have got to say either "Yes" or "No." If I say "Yes," it is obvious that people regard it as a political decision. If I say "No," then, equally, a lot of people would think that that was a political decision. I have not the slightest doubt— I am not saying this in the least offensively—that if it had been a Conservative organisation which proposed to send money to some Conservative organisation abroad and I had refused, I should have been accused of taking a political view. That would be quite natural.
The right hon. Gentleman says we must have either all or none. That is where the difficulty arises. Theoretically, as a matter of ease for the Chancellor, it would be much easier to say "all" or "none." Let us examine those two propositions. First, "all." The right hon. Gentleman will realise that if I said "all" there would be nothing to stop, for example, the Soviet Government transmitting £1 million from this country to the Communist Party of France.

Mr. Stanley: I did say that it should be subject, of course, to financial limits imposed by the state of the balance of payments just as, in the case of charities, we impose financial limits.

Sir S. Cripps: In the case of France, if we take a country separately and do not regard the principle as something applicable to all exchanges, there would be no difficulty at present. As the right hon. Gentleman knows we are lending, or giving, France £70 million of sterling this year. There is no difficulty, therefore, about transmission as far as the currency aspect is concerned. To put it on a smaller level, however, we should have to say that those sums could and should be transmitted.
I think that that is being wholly unrealistic as regards the state of affairs in Europe today. Although it may be that

the purpose of exchange control certainly is not to exercise political control, I think, on the other hand, that in a political situation of that sort we must not allow ourselves to encourage it by allowing the use of exchange control for encouraging it. Therefore we must, I think, take an attitude. If a cold war is going on all over Europe or, indeed, all over the world, we have got to take up an attitude on this question one way or the other.
What is the only sensible attitude to take? It is not a party attitude by any means, but there are certain general principles with which everyone in this House agrees and which we are in fact all, by different political methods and parties, striving to maintain: those are the permanence and maintenance of political democracy in Europe. I think it absolute madness not to allow people who wish to encourage right forces in any other country in Europe to do so. Why stop them? Because we are afraid the Communists may do it too? Is that a good reason for stopping the people we consider desirable being helped by people in this country?
We cannot take up the old position of laissez faire on a matter of this kind. We are in a very difficult situation in the world. There are great forces aligned against one another which are fighting out a cold war in Europe today. I certainly think people in this country ought to be encouraged to help the right side and not to encourage the wrong side. That is all I have done. I know it is an awkward onus on me and that I may make mistakes, but necessity in this situation must override my personal comfort or discomfort. I would far rather say "none" because then I would be perfectly safe and no one could accuse me of discrimination, favouritism, or anything else, but I do not believe that is right in the circumstances of Europe today.
Therefore, I hope the House will feel, whatever their views may be of whether I have arrived at a sound judgment on this, that at least I have tried to act on what I believe to be sound, honest principles. I am sorry that the hon. Member-for Farnham (Mr. Nicholson) accused me of different sorts of principles, because he has absolutely no basis for that whatever. I very much resent and regret what he said in his speech when opening the


case. One can perfectly well argue this on principle, without accusing people of dishonesty.

Mr. Nicholson: Mr. Nicholson rose——

Hon. Members: Withdraw.

Mr. Nicholson: I will certainly withdraw any implication of personal dishonour on the right hon. and learned Gentleman, if I ever made one. But I think as a statesman he has not been acting in an honourable way. There was some secrecy and there are differences of opinion in this House. I do not accuse him of being personally dishonest, but I do not think it is an honourable course for a member of the Cabinet.

Sir S. Cripps: I do not know what the distinction is between personal honesty and honesty as a statesman. I do not recognise any distinction. The hon. Member said that we sought to conceal this. Nothing of the sort. He cannot have read through the answers. He complained that no answer had been given which stated how many of these cases there had been. It was stated perfectly clearly. It was stated on 2nd December and, I believe, the hon. Member for Skipton (Mr. Drayson) asked again on 7th December if the Chancellor would:
give the total number of the political organisations in Europe to which he has already allowed money to be sent.
The answer was:
As far as I am aware, the only remittances to political organisations in Europe, other than normal fees and subscriptions by affiliated bodies to International Organisations, are those given in reply to the hon. Member's Question of 2nd December, 1948."—OFFICIAL REPORT, 7th December; Vol. 459, c. 26.]

Mr. Nicholson: The right hon. and learned Gentleman has challenged me. Has he got HANSARD of 30th November? I asked a Question of the number of charities and so on to which payments in sterling had been authorised, and in a written answer it was stated:
It would not be proper to disclose the details of individual applications, except with the consent of the bodies concerned. Since 1st January, 1948, 27 charities and political or quasi-political organisations have been authorised to remit £43,931 to France."—[OFFICIAL REPORT, 30th November, 1948; Vol. 458, c. 165.]
Is that the answer to the Question I asked?

Sir S. Cripps: Of course it is. The only authorisation asked for is to remit. People send requests through their banks to the Bank of England to get an authorisation to remit £1,000 for France, or wherever it may be. The authorisation that is given is to remit £1,000. The answer was perfectly clear.

Mr. Nicholson: That was not the question I asked.

Sir S. Cripps: I thought that the hon. Member understood about exchange control. I am afraid that I thought that when he asked what authorisations had been given he meant authorisations to remit, because there are no others than can be given. He really must not accuse us of dishonesty because he apparently put the wrong question.
I think that I have covered the whole ground on the points that have been raised. I hope that I have made it clear to the House that I stand completely unrepentant as regards anything that I have done. I have changed my mind in regard to the case of the memorials for the reason, if the House wishes to know what the reason was, that we are reexamining the position in the light of the intra-European payments scheme, which means that we shall have to make some differentiation, which we have not been able to make in the past, between different countries so far as exchange control is concerned. It is a difficult and complicated matter to work out. We are examining it now to see what can be done as regards trying to ease up in respect of countries where the position has been made much easier as a result of the intra-European payments scheme. In anticipation of what I hope possibly may be able to be done, I agreed to this arrangement as regards the memorials. I am glad that I have been able to do it, and I very much hope that some people have been comforted by the thought that these memorials can be erected in the future. Apart from that, I am completely unrepentant. I feel that this is the only policy, though a difficult policy, to pursue, and I shall continue to pursue it.

Adjourned accordingly at Twenty-two Minutes past Ten o'Clock.